Shine a spotlight on serious illness cover

A reality of struggling to put food on the table and pay bills is one that would face many people in the UK if ill health struck, and it’s a message that advisers and insurers have tried to relay for years.

But one we’ve struggled to translate into many more people taking out the cover that’s needed. A high-profile spotlight on the issue can certainly help to focus hearts and minds, and engage people to look at their own situation.

When thinking about protection most people still focus on the financial impact of death, but we all know a serious illness is what’s more likely to occur during someone’s working life.

The number of critical and serious illness policies taken out still lags far behind those of life cover, with around half as many policies sold, but illness cover should be high on the list of recommendations for clients.

While some illnesses may no longer be life threatening, they still have a significant impact on the life of the person suffering from it

However, when discussing illness cover advisers also need to consider what’s most appropriate and relevant for their clients in a changing world.

We are all living longer and medical advancements mean many conditions are detected sooner and treated more effectively, with survival rates improving as a result.

So illnesses that were previously deemed ‘critical’ might not meet the definition for payment on some policies today. When critical illness policies fail to meet people’s expectations, regardless of whether the decision is technically right or wrong, this can be hugely damaging to the perception of our industry.

While some illnesses may no longer be life threatening, they still have a significant impact on the life of the person suffering from it, which is why we believe severity-based illness cover is a fairer approach to paying claims.

With Serious Illness Cover from VitalityLife policyholders receive a payout that relates to the severity of their condition, of between 5 per cent and 100 per cent of the total sum assured. Clients are 2.5 times more likely to receive a payout with us, and we cover more heart attacks, strokes and cancers than any other insurer.

It may seem that the most important thing to someone taking out an illness policy is that they receive a big payout if a claim is made, but putting all of their money on an all or nothing bet leaves clients in a position where they are more likely to have a claim declined.

A more comprehensive option is to ensure that the cover will pay out when it’s needed, at a level appropriate to the impact of the illness being suffered, and that cover remains in place with the ability to make multiple claims throughout the life of the policy.

We’re also the only insurer to give people tangible benefits through their cover, by giving premium discounts, cashback and regular rewards for those that engage in healthy behaviour.

We understand that illness cover can be a complicated topic, and that explaining medical terminology alongside how the policy itself works can lose some clients along the way.

This is why we’ve created a Conditions Covered Tool, that helps simplify the understanding of what can be claimed for under our Serious Illness Cover and how this compares to typical critical illness policies on the market.

Specific areas of the body can be highlighted and explanations are given as to the cover clients would receive. While we’re not expecting an award from Cannes for our efforts, we’ve also made a short film for advisers and clients about simplifying Serious Illness Cover, which can be found alongside our new tool on the VitalityLife website.

So lights, camera, action – let’s spread the word.

For more information, visit www.vitality.co.uk/life/adviser