Legal & General Life and Critical Illness Cover, CI, May 2013
Legal & General has extended the cover of the Critical Illness Cover element of its protection offering from 15 April. Improvements include:
A new range of benefits for Children’s cover. This pays 50% of the insured benefit (up to £25,000) on any of the insured conditions except TPD. There is a 14 day survival period and cover lasts to age 18 (or 21 if in full-time education). One claim per child and two in total on the policy are payable. In addition up to £1,000 is payable to a registered childminder if any claim is paid under the policy.
Accident hospitalisation cover. This pays £5,000 if hospitalised longer than 28 days.
Maximum age at outset is now increased to 67.
New indexation option for term and critical illness cover. Benefits are linked to the Retail Prices Index (RPI, limited to 1-10% a year), with premiums rising by 1.5 times that increase (up to a maximum of 15% a year).
Total and permanent disability (TPD) is now optional.
The plan covers around 40 conditions and also pays out a partial benefit (the lower of £25K and 25% of the basic sum insured) on ductal carcinoma in situ of the breast treated by surgery and on low grade prostate cancer requiring treatment.
Comment: L&G is one of the big hitters in CI, paying out a whopping £209m to 3,080 CI customers last year.
The children’s changes are especially welcome and increase the plan’s appeal to parents. The childminder benefit is a good example of an extra benefit that provides real practical help just when it is needed. Making TPD and indexation optional probably makes sense, although we have a slight unease about making the one benefit that can help CI policies cover potentially many more conditions optional.
Plus points: Improvements in cover with now a strong range of children’s benefits; Household name brand with a track record (£300m+ is very reassuring to nervous customers).
Not so plus points: Is making TPD and indexation optional just taking the easy path?; The hospitalisation benefit could usefully be extended to cover illnesses too.
Website: http://www.legalandgeneral.com.
Rating (max 10): Innovation: 8. Overall: 8. Gold.