AIG Life has launched Key3, a simpler form of critical illness insurance that pays a lump sum upon diagnosis of one of three key medical conditions – cancer, heart attack or stroke. It is designed to give customers simple, affordable and essential critical illness cover, which can be bought with or without life insurance.
The provider is targeting individuals who haven’t traditionally considered such insurance, including younger, single people who rent rather than own their homes, those who may choose not to seek full face-to-face financial advice and those on a tighter budget.
Like AIG’s comprehensive critical illness cover, Key3 comes with access to the Best Doctors service, which can be used by the insured person for up to three years after payout, as well as access to the firm’s Claims Support Fund. This product can provide the claimant with up to £300 while AIG processes a claim to cover additional expenses, such as travel, parking costs and physiotherapy. Key3 is available to customers aged 17 to 75 and can be bought as a fixed (level), decreasing or increasing sum assured.
The Key3 Critical Illness Insurance pays a lump sum if a client is diagnosed with cancer, or suffers a heart attack or stroke, while the Critical Illness with Life Insurance pays a lump sum if clients are diagnosed with cancer, suffer a heart attack or stroke, die or are diagnosed with a terminal illness and have less than 12 months to live.
Adviser view
Emma Thomson, head of customer care at LifeSearch, said it would be interesting to see how consumers respond. “The critical illness market has become complex over recent years as more and more conditions have been added. Focusing on the core three conditions that people claim on the most, in order to simplify the decision-making process, will hopefully help engage consumers and some distributors who have been put off critical illness cover in the past,” she said.
“I think it will particularly help consumers who are buying non-advised, some of whom might be overwhelmed with complicated documentation covering 50-plus illnesses and who stick with life cover only as a result. It will have less appeal to advisers who are already regularly discussing critical illness with their clients, because it is unlikely to offer the best value cover, and I expect most advisers will continue to recommend traditional critical illness policies to provide greater peace of mind.”
