Necessity is the mother of invention

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Protection Gap - June 2014

But despite this positive step he urges providers to make terms clearer, and warns his peers to avoid policies with “variables”.

“Policies with variables such as ‘own or suited’ and ‘any occupation’ should be avoided in the majority of cases.

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“Friends Life, for example, has a best doctors option giving you access to the top healers upon claim. Many other insurance companies, as well as friendly societies, actively seek remedies to make claimants better as it is in their interest to stop the payments.

“If insurance companies want to regain trust they should remove terms that are open to interpretation, as well as marketing critical illness policy conditions like progressive supra nuclear palsy, which are statistically irrelevant.”

In spite of scepticism from some industry figures that 2014 had so far brought very little in terms of innovation, Sarah Fullaway, director of Oviso, is encouraged by what she describes as a period of “very positive changes”.

Of particular note, she says, were “significant enhancements” to critical illness policies, which had helped remove ambiguity around claims in many major illnesses, and the increased number of added value benefits being introduced throughout the sector.

The most eye-catching advancement that she had witnessed of late was PruProtect’s changes to its Vitality product, which she says gave clients the control to engage in healthy living while being rewarded with upfront discounts.

“Added value benefits are a big deal now as consumers look for more ways to get better value,” she added. “Insurance is often seen as lost money if a claim is not made, so this sees consumers being able to enjoy savings and benefits while not claiming, which is a big win in my opinion.”

Top three protection picks

Critical Illness: PruProtect’s Serious Illness Cover

One adviser says this product represented a “great development” that had influenced other providers to incorporate partial payment elements in their policies.

The plan offers policy terms from five to 50 years and either reviewable or guaranteed premiums. In total, Serious Illness Cover covers 166 conditions on the Comprehensive Cover plan and 102 conditions on the cheaper Primary Cover plan.

Income Protection: LV Budget Income Protection

According to one adviser LV “stands out” as the best income protection product provider, with its 24 month payout option “great for clients with a limited budget”.

This particular plan offers deferment periods of four, eight, 13 and 26 weeks, and can cover a maximum of 55 per cent of gross taxable earnings. The minimum policy term for this product is five years.

Life Insurance: Ageas Protect Real Life Cover

Ageas Protect Real Life Cover is selected by one adviser because it did not contain a “terminal illness clause” and came with “added benefits”.