Cuna Mutual FuneralProtect+
Cuna Mutual has launched a new life insurance product in conjunction with The Co-operative Life Planning.
The plan is available direct, and also through building societies and credit unions across the UK.
FuneralProtect+ offers a choice of guaranteed sum assured of between £2,000 and £6,000 per insured person and can cover up to 12 family members. Premiums start at just £2 a month. Someone aged 50-59 would pay £7.00 a month for £2,000 of cover, while someone aged 30-39 would pay £3.00 a month and someone aged 60-69 would pay £13.00 a month. Premiums are pro rata for higher sums insured. Under 18s are covered free.
Premiums and sums insured are set at outset and guaranteed for life. Acceptance is guaranteed up to age 70, with no medical or health questions and full benefits payable after six months.
Applicants must be aged under 70 and be resident in the UK (older applicants may be accepted, at Cuna Mutual’s discretion).
During the first six months of the policy (or any subsequent increase to an existing plan) no benefit is payable, except in the case of accidental death. Thereafter the full sum insured is paid.
Benefit is paid automatically (using a charge in their favour) to Co-operative Funeralcare to pay for the life insured’s funeral, with any positive balance being paid to their estate. Or, if other lives insured remain alive, to the policyholder (if alive) or their spouse (or significant other), parents or children, in that order.
Under the same policy, a spouse or significant other, parents and children can also be covered (up to 12 lives in total). The policy is written as a whole life policy, and can run until the last person insured dies.
Plus points: Guaranteed payment policies are simple, offering whole of life cover at low cost and so are marketed as being able to pay for a funeral (the average cost of which is now around £3,000 according to Cuna); Linking the benefit directly to the Co-op makes the process of organising a funeral even easier (and customers can choose later on not to use the Co-op if they wish); Cuna is unusual in that it allows up to 12 family members to be covered under the same policy, so a family couple could insure their parents as well as their children and themselves all under the same policy; Full benefits after six months.
Not so plus points: Someone in their 60s would have paid in more than the plan’s sum insured after 153 months (less than 13 years), although the period is much longer at younger ages; Better value can be obtained from conventional policies, although that may mean having to pay a larger premium (for more cover) and having to be underwritten; No mention is made of being able to add grandchildren either—this would otherwise look to be an opportunity for grandparents to pay for cover for the whole family.
Website: http://www.funeralprotectplus.co.uk.
Rating (max 10): Innovation: 6. Overall: 5. Bronze.