Income protection policies from the British Friendly Society will now be paid out to the next of kin in the event of the death of an insured policy-holder.
It will be paid as a lump sum worth around six times the monthly income protection payment.
British Friendly is the first provider to offer this type of benefit to both new and existing customers. Policyholders can nominate multiple individuals to receive a percentage of their death benefit payments.
Iain Clark, marketing and distribution director at British Friendly, said: “As a mutual, British Friendly always looks to offer product enhancements that are genuinely useful to our members and advisers.
“By providing an amount of life cover automatically, we are improving customer value through additional membership benefits for both new and existing customers with something that many families will appreciate.”
The Society will also be making retrospective payments of the death benefit for members who died after January 1 2016.
Scott Gallacher, an IFA at Rowley Turton, said: “So many people are so under-insured, it’s a case of every little helps. Having six times what’s in the original pot is a very nice sum, and would certainly help relatives to pay for the funeral. It won’t change the world, but I can’t think of anyone else offering this to existing customers, so in a way, it is groundbreaking.”
