Aviva has scrapped an exclusion on its life insurance policies that prevented clients diagnosed with a terminal illness and given less than 12 months to live from claiming on a policy that had less than 18 months left to run.
Policies that include terminal illness benefit typically pay out as a lump sum before death where a client is diagnosed with a terminal condition and given less than a year to live.
Under Aviva’s previous terms, which are not being changed for existing customers, clients with term insurance are excluded from receiving terminal illness benefit in the last 18 months of their policy. Where the client outlives the end date of the policy, it will simply not pay out.
Aviva said the change, which applies to new policies only and comes alongside a number of other changes to definitions on conditions covered under its critical illness policies, will “increase the number of claims paid”.
The definitions changes apply to stroke and multiple sclerosis, two conditions which Aviva said rank third and fourth respectively in terms of the most common reasons for claims.
Under the new multiple sclerosis definition, customers will only be required to prove a definite diagnosis with current symptoms. Previously they were required to present continuous symptoms for three months in order to successfully claim against their policy.
In the case of strokes, clients will not longer have to present permanent symptoms in order for their claim to be paid.
Four ‘additional benefits’ are also being added to the insurer’s critical illness policies that will mean clients receive a payment of up to £20,000 if they are diagnosed with one of four conditions, which Aviva said if untreated can lead to one of the top five ‘critical illnesses’ - cancer, heart attack, stroke, multiple sclerosis and benign brain tumour.
The four conditions are:
• Carcinoma in situ of the cervix requiring treatment with hysterectomy
• Carcinoma in situ of the testicle requiring surgical removal of one or both testicles
• Arteriovenous malformation (AVM) of the brain with specified treatment
• Cerebral aneurysm with specified treatment
Following the changes, which again do not apply to existing clients, new Aviva critical illness policies will cover 57 conditions, including 11 additional benefits. The firm added that 18 of its definitions on these conditions are more extensive that the minimum ABI standard.
Robert Morrison, chief underwriter, said: “Ninety-three per cent of our CI claims are made up of just five conditions - cancer, heart attack, stroke, MS and benign brain tumour - so by concentrating our enhancements around these core illnesses, we can hope to make a difference to the largest number of people possible.”
