Ellipse Group Critical Illness
Ellipse has launched a number of changes to its group critical illness product. In terms of conditions covered:
Two new core illnesses have been added. They are: Creutzfeldt-Jakob disease (CJD) and dementia. The latter was originally an additional illness.
Seven new additional illness conditions have been added. These are: bacterial meningitis; balloon valvuloplasty; benign spinal cord tumour; cardiac arrest; encephalitis; liver failure, and pulmonary artery graft surgery.
Although not a standard benefit, Ellipse will also cover coronary angioplasty if the scheme already has it or it is desired by the employer/adviser. There will be an additional premium loading.
The plan now covers 12 core illnesses and 29 additional ones, plus optional permanent total disability cover.
For flexible (flex) and voluntary benefits schemes, a two year rate guarantee for new flex schemes is available. Being actively at work applies for the initial selection where employees can choose any benefit and, at future benefit selections, employees can flex up by 5x salary or £100,000, whichever is lower. For both new and existing flex schemes, a pre-existing conditions excluded (PECE) basis is available (this helps keeps costs lower and means no individual assessment can be offered on schemes of five lives or more).
Ellipse has also revised its pricing, to make its rates more competitive across the board.
Employees can now opt to cover their partners through their flexible benefits programme. The definition of partner has been expanded to include cohabitant partners. So, an employee can cover a person they are married to, or in a civil partnership with or cohabiting with. A cohabitant partner is defined as: ‘a person who is in a relationship resembling marriage with the member whom has the same main residence, and has done so for at least six months and is either i) financially dependent on the member, or ii) in a relationship of mutual dependence with the member’.
Children are now covered from birth (previously 30 days), and they are covered until their 18th birthday or 23rd birthday if in full time education.
Premiums are usually guaranteed for two years and the plan consists of both core and additional illness covered. Claimants and their families get access to the Red Arc critical illness service. Maximum benefit is the lower of five times salary or £500,000.
There is a 48 page online technical guide for customers which explains both the new changes and the other features of the plan, and a three page summary plus the full terms and conditions.
Comment: Ellipse’s approach to this update has been to add more conditions, widen who can be covered and offer lower premium rates. That’s a powerful combination that should make its plans appeal more in the growing group CI space.
Group CI plans often look a little old fashioned compared to individual plans. That’s not a criticism in itself, but it can put off some advisers and means that individual and group CI cover comparisons may be difficult.
One issue – and it’s a criticism across the group risk space – is that many policies do not include a continuation option. That means if an employee leaves their employment, switching to an individual policy can mean not just different cover, but more expensive cover and fresh underwriting too. That’s a powerful disincentive to switching and could maybe be tackled by offering a lower sum insured for the same premium if a continuation option is included.
Plus points: Two new and seven additional illnesses added; More types of partner can be added; Premiums now more competitive.
Not so plus points: No consolidation of similar definitions; No continuation option as standard; Individual CI plans can offer wider cover than group plans.
Website: http://www.ellipse.co.uk.
Rating (max 10): Innovation: 7. Overall: 8. Gold
Tags: CI: Ellipse; Product enhancement