This year is likely to be the busiest ever for critical illness (CI) changes. All Association of British Insurers (ABI) members have until February 2019 to adopt the revised model wordings and this invariably involves them upgrading their plans at the same time.
On this point it is interesting to note that AIG, within its recent upgrade, has not introduced the revised wording for cancer, which suggests another refresh is due within six months.
As a dedicated protection insurer it is imperative that AIG provides high quality products to advisers who are able to choose from 10 other providers. Throughout its existence, first as Fortis and then Ageas, it has designed plans at or near the top of the quality offerings and the latest upgrade continues this trend of offering worthwhile comprehensive cover.
The most obvious advance is the increase to additional condition payments up to £35,000/50 per cent of the sum insured from the previous £25,000/25 per cent. To avoid potential confusion AIG has harmonised child cover so that it also pays at the £35,000/50 per cent level for both 100 per cent and additional payment conditions.
Children’s cover has benefitted from the addition of five new conditions – craniosynostosis, Edward’s syndrome, hydrocephalus, osteogenesis imperfecta and Patau syndrome – as well as an increase in the child death benefit from £5,000 to £10,000.
Including the new pregnancy-related cover, which encompasses eight sub-conditions, AIG now offers 85 adult conditions. There are 46 100 per cent payment conditions, which includes four additions – Devic’s disease, intensive care, severe mental illness and surgical removal of an eyeball.
Additional payment conditions have been increased from 30 to 39, with the inclusions of accidental hospitalisation, Crohn’s disease, gastrointestinal stromal tumour (GIST), lobectomy, neuroendocrine tumour (NET), permanent pacemaker insertion, severe sepsis and syringomelia/syringobulbia.
In addition, 16 conditions enjoy improved claims wordings which either extend the cover or simplify the claim process.
Cancer results in around 52 per cent of male claims and 77 per cent of female, so the addition of GIST, NET and the inclusion of cryotherapy for treating early stage prostate cancer ensures that AIG is at the forefront of cancer coverage.
Advisers have three methods of selecting the most appropriate plan for their client – the lowest cost, the best quality or value-for-money. AIG is certainly not the lowest cost but the improved plan does fall within the other two categories.
Any adviser selecting CI cover plans on cost is taking a big risk because online insurers will be cheaper and savvy protection advisers will likely guide their clients towards plans that offer greater coverage.
Alan Lakey is founder of CI Expert