LV has joined Legal & General to offer specific income protection for renters.
As the number of people that are renting rather than joining the property ladder is increasing, the development of income protection policies for this specific market is a sign that these insurers are looking at the needs of modern society and responding accordingly.
IP policies allow the policyholder to protect a portion of their gross salary, so if they are unable to work, they can continue to maintain their standard of living.
The LV IP policy has a number of features that allow it to be reactive to changes in life’s circumstances.
A guaranteed insurability option allows the benefit amount on the policy to change, without additional underwriting, if the policyholder’s rent increases.
LV has also taken the concern around redundancies on board and offers a six-month payment holiday for policyholders that are made involuntarily unemployed.
The policyholder can retain their policy, without fear of having to maintain payments and placing themselves under added financial strain while they are looking for new employment.
According to LV, 38 per cent of renters have children. This makes its additional features for children’s critical illness cover a welcome addition.
A policyholder with LV IP gains access to added benefits if their child is diagnosed with one of 54 critical conditions.
Should a child receive a critical diagnosis, the IP policy pays out a cash lump sum six times the monthly benefit (to a maximum of £25,000).
This can help the parent to take a leave of absence from work to focus on their child, pay for accommodation near hospital, travel expenses and added childcare.
To further this concept of looking after the policyholder and their family too, the LV IP policy also comes with some death benefit cover included.
Depending upon how long the policy has been active, should the policyholder pass away during the policy term, their family will receive a cash lump sum between £5,000 to £10,000 to help them towards funeral costs.
The policy also comes with fracture cover benefit, providing a cash lump sum (separate to benefits being claimed on the regular monthly benefit level), for 18 different types of fractured bone.
LV IP policyholders can get access to remote GP, second medical opinion, rehabilitation and prescription services, physiotherapy, mental health support, discounted health MOTs and legal advice.
These added value benefits demonstrate that LV is taking the long-term wellbeing of their policyholders seriously.
The support and long-term care that value-added benefits can give a policyholder is now the key area of competition between insurers.
Kathryn Knowles is managing director of Cura Financial Services