Scottish Widows has introduced a number of changes to its critical illness products, offering wider cover yet with greater simplicity too. The key changes are:
* A new additional payment condition of carcinoma in situ with surgery pays the lower of £25,000 or 25% of the sum insured. This definition embraces a number of individual conditions – in fact the insurer has incorporated five sub definitions into this catch-all. Although four individual conditions (bladder, prostate, ovarian and pituitary) are retained, as they have a more precise claim wording. The five incorporated into the new generic heading are for carcinoma in situ of the breast; cervix uteri; endometrium; oesophagus, and testes.
* The qualifying age for children’s claims has been increased by one year from 21 to 22.
* Nine critical illness definitions have been altered. These are for benign brain tumour; brain injury/anoxia/hypoxia; cardiomyopathy; coma; dementia; intensive care; liver failure; motor neurone disease and Parkinson’s. For a number of conditions, the previous drug and alcohol exclusion has been removed. The old definitions for Alzheimer’s disease and dementia have also been amalgamated into one definition.
What They Say
Head of underwriting and claims strategy, Scott Cadger, said: "Advances in medical science have led to earlier detection of illnesses and greater survival rates, and we recognise that as people’s needs evolve, our critical illness policy wording needs to adapt accordingly.
"We’re committed to paying as many claims as possible and as quickly as possible in order to help people when they’re at their most vulnerable. These changes have wider scope than before and will therefore enable us to provide financial support to more customers at a time when they need it most.
"Removing complexity will also make things clearer and simpler for advisers and clients alike, with no complicated policy conditions to work out at that all-important point of claim."
What We Say
"In its analysis of the changes, CIExpert said: 'We hope that other insurers look to similarly reduce the number of conditions, while simultaneously reducing the number of claims declined'. We’d echo that – the previous trend of conditions hyperinflation, where insurers battled to offer the greatest number of conditions tended to be rather counter-productive. Instead, the new trend is consolidating similar conditions into one over-arching condition definition. The ultimate extension of that would simply be to cover any critical illness – but we are still a long way from that.
"For advisers, having fewer but wider conditions might look counter-intuitive – surely more is better? But, provided the broader definitions are actually embracing more situations, then the role of the adviser becomes even more important in separating the ‘marketing hype’ of covering more conditions, from the practical reality of paying more claims. I know which we think is more important…
"Overall, Scottish Widows has succeeded in both simplifying its cover and increasing the number of potential claims it can pay. Both aims are commendable and should help ensure the insurer’s CI plans make even more adviser shortlists."