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Scottish Widows consolidates critical illness definitions

Changes simplify cover while widening the scope for a claim

Scottish Widows has made changes to the critical illness (CI) element of its Protect plan in an attempt to simplify cover and focus on the most claimed for conditions.

The provider has introduced headings under which numerous similar or linked conditions are covered.

This serves to reduce the number of conditions while widening the scope for a claim.

Scottish Widows Protect now offers 39 headline conditions and five child specific conditions, although through the sub-categories it actually covers 59 conditions as well as five child specific conditions plus total permanent disability.

Meanwhile, the payment level for additional payment conditions has been raised to the lower of £30,000 or 25% of the sum insured.

Children’s cover has been improved to the lower of £30,000 or 50% of the parent’s insurance and the child death benefit increased to £10,000.

Booster payments of an extra 50% (up to a maximum of £200,000) have been introduced for dementia, motor neurone disease, major organ transplant, Parkinson plus syndromes and Parkinson disease, if diagnosed before age 45.

“These changes really lay down the gauntlet and should encourage other insurers to look at how they could simplify their own definitions”
Adam Higgs, Protection Guru

In addition, seven conditions – aorta grafts, benign brain/spinal tumour, cardiac arrest, coronary artery by-pass graft, heart valve repair/replacement, open heart surgery – will benefit from an advanced payment once on the UK waiting list. 

HIV/AIDS has been removed from the roster of conditions.

Alan Lakey, of CIExpert, said he has been urging insurers to reduce the numbers of conditions by incorporating linked or similar conditions under one heading.

Johnny Timpson of Scottish Widows: “We promised that we would strive to make critical illness insurance as accessible and simple as possible”

“The logic being that lists of conditions, many of which consumers have never encountered or heard of, serve to confuse and dilute the message that the plan is of value,” he explained. “The changes announced by Scottish Widows for its Protect range go some way towards achieving this – reducing numbers whilst widening the coverage.”

Lakey suggested the changes could spark a trend and that sooner or later an insurer will introduce an outcome-based plan which will include disabling conditions that have never been specifically named yet produce similar outcomes to named conditions.

Johnny Timpson, protection specialist at Scottish Widows, said: “Scottish Widows promised Dr Marius Barnard that we would strive to make critical illness insurance as accessible and simple as possible, focusing on the conditions that give rise to the majority of claims and paying as many of them as we can. The enhancements that we have announced are another milestone in delivering on that promise.”

Adam Higgs, head of research at Protection Guru, added: “Perhaps what is most impressive is the way they have consolidated similar conditions into single definitions whilst at the same time broadening the cover offered, something that is not easy to do. These changes really lay down the gauntlet and should encourage other insurers to look at how they could simplify their own definitions.”