Friends Life widens critical illness cancer cover

Friends Life widens critical illness cancer cover

Friends Life has updated its critical illness product, improving coverage of less advanced cancers to give one of the widest covers available within a standard policy.

The firm already includes four specific in situ cancers – breast, prostate, cervix and bladder – providing for payments varying between £12,500 and 12.5 per cent and £25,000 and 25 per cent.

The new inclusive condition covers and additional 16 in situ cancers, meaning it now offers the widest cancer cover within a standard CIC policy, according to Alan Lakey, director at CIExpert.

The product update clears up the wordings on seven conditions to meet the December 2015 deadline for complying with Association of British Insurers’ models.

The four major changes are: the introduction of a new over-arching condition “less advanced cancers”, the introduction of a new additional payment condition “severe hearing loss”, ensuring homogenous payouts for all of the additional payment conditions, and the removal of Alzheimer’s as it is already covered within the auspices of dementia.

By mandating all additional payment conditions payments as the lower of £25,000 or 25 per cent of the sum assured, Friends Life has removed confusion and in some instances has doubled the existing payment available, according to Mr Lakey.

Mr Lakey said: “The improvements are beneficial in that they will increase the numbers of claims and simultaneously reduce those cancer claims that are currently declined for being in situ.”

In terms of severe hearing loss, the ABI model wording requires hearing loss in the better ear to be 95 decibels or higher.

This additional payment reduces the requirements to 70 decibels in the better ear, although Mr Lakey added that Friends Life’s wording mirrors that used by Old Mutual and Legal and General, both of which provide 100 per cent payouts.

Emma Thomson, life office relationship director at Lifesearch, said: “Friends Life has significantly improved coverage of less advanced cancers; a key concern for consumers and most importantly will enable more clients to claim,” adding that making all additional payments 25 per cent or £25,000 also simplifies the terms and conditions.

“Friends Life have once again focussed on making improvements that are meaningful and through improving definition wordings, will make it much clearer for clients what they are covered for.”

Meanwhile, both Aviva and Vitalitylife have published their claims statistics for last year.

Over the year, Aviva paid 99 per cent of life insurance claims and 93.2 per cent of critical illness claims.

Of critical illness claims which were not paid, 1.2 per cent of them were declined due to misrepresentation (non-disclosure) and 5.6 per cent for conditions not met.

VitalityLife paid 99.4 per cent of life claims, 91 per cent of serious illness claims and 98 per cent of income protection claims in 2014.