Protection challenger Guardian is to expand its life cover product range to provide more choice for customers.
It said the product enhancement will include the launch of a low-cost life cover, Life Essentials.
Until recently, Guardian only offered Life Protection with enhanced features.
However, the insurer said it wants to better meet the needs of a wider range of clients including those impacted by the higher cost-of-living.
It also said the covers will appeal to clients whose primary focus is affordability as well as those who place less value on a feature-rich product.
The new low-cost Life Essentials cover will have many of the benefits customers expect from a Guardian policy.
These include a dual life approach, Premium Waiver (with a 26-week deferred period which pays out on ‘own job’), optional Children’s Critical Illness Protection, beneficiary nomination through Payout Planner.
Other benefits value-added services, Guardian Anytime, and HALO, the protection company’s bespoke claims support service.
What’s different?
Guardian says some high-quality features are reduced for Life Essentials in a bid to make the product affordable. A full comparison of the differences between the two life cover choices is outlined below:
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LIFE PROTECTION When your client’s priority is quality |
LIFE ESSENTIALS When your client’s priority is price |
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Terminal illness |
Pays out if a client is expected to survive for less than 12 months. Also pays out if they’re diagnosed with incurable stage 4 cancer, motor neurone disease, Creutzfeldt-Jakob disease or Parkinson-plus syndromes even if they’re expected to survive more than 12 months. |
Pays out if a client is expected to survive for less than 12 months. |
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Premium Waiver |
Included as standard with a 4-week deferred period. Premiums waived if the client is too ill to work. Premiums also waived for up to 6 months for maternity/paternity leave or if they involuntarily lose their job. |
Included as standard with a 26-week deferred period. Premiums waived if the client is too ill to work. |
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Exclusions |
No standard exclusions | Doesn’t pay out if death is due to suicide or is a result of intentional self-inflicted injury in the first 12 months of the cover. |
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Cover type |
Level Cover, Increasing Cover, Decreasing Cover, and Family Income Benefit are all available. Increasing Cover increases in line with the retail price index (RPI). |
Level Cover, Increasing Cover, and Decreasing Cover are available. Increasing Cover increases in line with the consumer price index including owner occupiers’ housing cost (CPIH). |
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Lifestyle Promise |
A client’s premium may be reduced if they were paying an increased amount due to their health or lifestyle and they subsequently: stop smoking, lose weight, change job, give up sports activities. | A client’s premium may be reduced if they were paying an increased amount due to smoking and they subsequently stop smoking. |
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Immediate cover |
Temporary cover, of the same type applied for, and it starts as soon as the application is submitted online. Pays out a maximum of £1 million before Guardian offers terms. |
Temporary cover, of the same type applied for, and it starts as soon as the application is submitted online. Pays out a maximum of £300,000 before Guardian offers terms. |
The insurer noted that Life Essentials has a different Terminal Illness definition to Life Protection.
Its new low-cost cover defined it as: “being terminally ill and, in the opinion of your attending UK Consultant, your illness has no known cure or has progressed to the point where it can’t be cured and is expected to lead to your death within 12 months”.
This contrasts with the enhanced Terminal Illness definition on Life Protection which does not require the 12-month prognosis for incurable stage 4 cancer, motor neurone disease, Creutzfeldt-Jakob disease or Parkinson-plus syndromes.
For both Life Essentials and Life Protection, the policy terms and conditions state that Guardian will pay out on the definite diagnosis of the policyholder’s treating UK Consultant.
Guardian marketing and proposition director Jacqui Gillies said: “We’re delighted to announce we’ll soon be offering a choice of life covers, enabling advisers and their clients to select between our low-cost Life Essentials and our existing premier Life Protection. The time is right to be offering this choice; the higher cost-of-living means that many clients simply have less budget available for protection. It also broadens our appeal within client segments traditionally focused on affordability, helping us reach a wider market and accelerating our distribution growth.”
