Legal & General Group Critical Illness Cover
Legal & General
L&G has made a series of changes to its existing group critical illness (CI) plan including:
- Adding five more conditions. Aplastic anaemia; bacterial meningitis; cardiomyopathy; encephalitis, and liver failure have been added, taking the total to 38 conditions (when the Additional option is selected – otherwise, only 12 conditions are covered under the Core option).
- The maximum benefit has been increased to the lower of £500,000 and five times scheme earnings.
- A free cover (underwriting free) limit of £500,000 can apply to high earners.
- The survival period has been cut from 30 days to 14 days.
- The maximum benefit for spouses and registered civil partners has been increased to £150,000.
- The maximum benefit level for employees joining a voluntary plan has been raised to the lower of £250,000 and five times P60 earnings.
Pre-existing and related conditions are not covered. The former is well explained in the literature (and online) but the latter is based on the opinion of L&G’s medical adviser only and no examples are given of either.
Technical guides on both standard and voluntary schemes help explain the plan for intermediaries, although we had problems downloading these in early March. Existing plans can be upgraded to no extra cost.
The minimum scheme size is usually 50 employees and children’s cover (the lower of £20,000 or 25% of the member’s benefit) is automatically included, regardless of the number of children. Target turnaround time on claims is five days from receipt of all documentation. There is also a 24/7 employee and managers assistance programme called Worklife Solutions.
Established in 1836, Legal & General has over seven million UK customers and worldwide funds under management of £370bn. It is one of the biggest protection providers in both the individual and group markets.
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What They Say
Underwriting and benefits director Vanessa Sallows said: “Employers and employees all over the country rely on critical illness cover to help them to cope with challenging circumstances. Expanding the range of illnesses that we cover means we can help more people when they are ill.”
What We Say
We still have concerns that CI cover generally does not include all critical illnesses and that some of those that are covered (and, admittedly, the vast majority are covered) have definitions that are beyond the comprehension of most customers. That said, this is an industry issue not that of any provider.
So far as this plan is concerned, we think that both pre-existing and related conditions could be better explained, especially by adding examples. Long-term protection insurers could learn from private medical insurance providers here – where cancer cover especially now has to be well explained, with examples given. Core cover only includes 12 conditions under L&G’s plan, but 26 extra conditions can now be included, albeit at extra cost.
Overall, L&G has introduced a raft of useful and positive changes that further enhance its reputation in this sector and should appeal both to potential clients and to intermediaries too.
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