Increase in the maximum insurable benefit under LivingCare

We have increased the maximum initial insurable benefit under LivingCare, our long term disability insurance policy, from £20,000 to £35,000 p.a.. (Once in payment, the benefit increases in line with RPI every year.)

Comments Dale Tranter, Assistant Underwriter at UP, “Some advisers have been telling us that £20,000 is not high enough for their clients’ needs. We have listened to this feedback and this change will hopefully enable them to support us going forward.”

LivingCare provides insurance against long term disability, claims being assessed on the client’s ability – or otherwise - to perform Activities of Daily Living. The policy has no investment element.

Dale Tranter, Assistant Underwriter

Universal Provident brings underwriting in-house

With effect from 1st July 21011 the underwriting of most of Universal Provident’s product range was brought in–house, with our sister company Personal Assurance Plc now the insurer. Underwriting was formerly provided by Great Lakes, part of Munich Re (which will still be involved as reinsurer). Existing business will move across to Personal Assurance as it renews.

The products affected are the Choices PMI range (and the other PMI plans still available for existing customers), DentalCare, LivingCare (long-term disability) and IncomeCare (income protection). Universal Provident’s travel and MPPI policies will still be underwritten by their current external underwriters.

Our ability to underwrite products in house demonstrates the growing financial strength of the group. Underwriting products in house gives us more flexibility for our customers, as well as more credibility as a provider with the intermediary market. Personal Assurance already insures its own range of insurance plans, so we have many years of relevant experience and expertise.

Dale Tranter, Assistant Underwriter

A solution for the lengthening NHS waiting lists

A recent report from the Kings’ Fund shows how NHS waiting times are on the increase. For example, 33.2% (nearly a third!) of people treated as in-patients during February 2011 had been waiting more than 90 days since referral.

This demonstrates the value of a product such as Universal Provident’s Choices A2 In-Patient plan, which provides full in-patient treatment cover, provided the waiting list for that treatment is at least 90 days. (If the waiting time is less than 90 days then clients use the NHS as usual.)

A 40 year old single male would pay just £10.79 per month for cover. A 40 year old couple with four children would get an even better deal, paying just £26.43 per month. (Rates correct as at 4th May 2011, nil excess, hospital scale C (national), moratorium basis).

With waiting times increasing, this product is effectively becoming more valuable every month!

Dale Tranter, Assistant Underwriter

ECJ Ruling on the effect of gender on insurance pricing

As reported recently on the national news, the European Court of Justice has ruled that, from December 2012, insurers will no longer be able to price by gender, even where mortality or morbidity considerations dictate that they should differentiate.

The probable effect on motor insurance premiums grabbed the headlines at the time of the ruling, but this will apply to other classes of insurance, including all those marketed by Universal Provident.

Some other medical and income protection insurance companies currently price differentially between the sexes, but Universal Provident does not. This means that we are not anticipating any sharp increases in premiums for either sex between now and January 2013, at least not due to the removal of gender differentiation.

Dale Tranter, Assistant Underwriter

Sharing of data/loading in the absence of claims experience

We are happy to share high level claims information on private medical insurance with the authorised broker. (Names and details of specific conditions would not be disclosed for reasons of client confidentiality and data protection.) As far as we are aware, ourselves and Groupama are the only insurance providers to do this.

Regarding new business quotations, where we do not have any details of past claims experience, we will generally load quotations for schemes of 5 or more members looking to switch on CPME terms by 6.5%. Ideally we would like total premiums, claims and the number of members for the previous three scheme years, but we appreciate – for the above reasons - that this may be difficult to obtain.

Dale Tranter, Assistant Underwriter

Trail/legacy commission post December 2012

The FSA recently ruled that commission payable on policies set up before December 2012 but which undergo alterations - such as the addition of a dependant or indexation, which would at present generate commission – will cease after December 2012.

As our contracts are general insurance rather than long term protection, they renew annually (except for IncomeCare and MortgageCare which are renewable monthly). This means that new contracts are effectively written every year, which enables us to carry on paying commission as at present, even in the case of policy alterations which would no longer attract commission on long term business come 2013.

In cases where we are currently paying commission to agents that are no longer active/authorised, our understanding is that the latest rules allow us to continue to do so.

Dale Tranter, Assistant Underwriter