The products comprise:
• The Increasing Plan – benefit increases in line with inflation
• The Funeral Plan – protects against rising funeral costs
Legal & General business partners (sole-tied to Legal & General for protection) have sold more than 500 ‘Over 50s’ plans since it was launched in the channel in March.
The new plans are available to anyone aged between 50 and 80 and applicants are guaranteed to be accepted for cover. Monthly premiums stop aged 90 although cover will automatically continue until death. The benefit for the Increasing Plan and Funeral Plan are reviewable annually in line with inflation, as measured by the Retail Price Index. However, policyholders can choose to freeze their sum assured at any time and not increase it any further.
Premiums will also be reviewed each year and will increase by 1.5% for every 1% increase in the benefit. The Funeral Plan covers the cost of a cremation funeral, provided through Dignity, the UK’s largest funeral plan provider. If customers would prefer a burial, this plan will pay a contribution towards these costs.
Malcolm Cowcher, sales director, Legal & General Partnership Services Limited (LGPSL) said: “This is an alternative revenue stream for our business partners, which is welcome whilst mortgage-related protection sales are challenging. People traditionally take out this type of life insurance to provide their family with funds to go towards funeral expenses or unpaid bills, or as a gift for children or grandchildren. We’ve now got three different plans to give advisers and their clients the flexibility to choose the product which best serves their needs.”
Policyholders are guaranteed a payout after two years if they die, as long as the premiums are paid when due. If death occurs within the first two years the premiums will be refunded in full unless the death is the result of an accident in which case the full benefit amount will be paid. None of the plans have any cash-in value at any time.
