Royal London has boosted its critical illness cover (CIC) in a bid to improve protection claims outcomes for parents and their children.
The changes, effective from tomorrow, mean pay-out for additional cover conditions for parents has gone up from a maximum of £25,000 to £30,000. This also increases the pay-out under enhanced child critical illness cover.
Under the enhanced child CIC, Royal London has increased the children’s death benefit and the payment for still birth to £10,000 (both previously £5,000). And for standard child CIC, there is an additional new child death benefit of £5,000.
Parents will also now be able to protect their children on Royal London’s child CIC up until the age of 22 or 23 for those still in full time education.
Royal London has also added two new increase options for renters on its life, critical illness and income protection cover.
The first option enables renters to increase cover if their rent increases, while the second allows renters to increase it if they take out their first mortgage.
Jennifer Gilchrist, protection specialist at Royal London, said: “The recent improvements to our critical illness cover are essential to make sure we are providing financial support and the best possible outcomes for our customers.
“No parent should ever have to experience the death of a child, which is why some of the changes are targeted at pregnant mothers and parents to help provide protection for themselves and their children in the best way possible.
“But insurance isn’t just about financial support at Royal London and, as ever, our Helping Hand service providing invaluable emotional and practical support is there throughout to listen, empathise and help people cope with their experience of illness or bereavement.”
‘More significant than at initial glance’
Alan Lakey, director at CIExpert, welcomed the changes due to the fact they provide increased payments for both adults and children.
“While the payment level change may not seem particularly large the impact of changing the limit on payment from 25% to 50% is much more significant than an initial glance suggests,” he said.
Lakey noted with the previous additional payment level at the lower of £25,000 or 25% of the sum insured, on a decreasing term plan the level of payment progressively reduced for any sum remaining less than £100,000.
“Shifting to a payment limit of 50% means that a reduction only occurs when the residual sum assured drops below £60,000 and therefore has a much more significant impact than one might imagine,” he continued.
“This is because the likelihood of a claim increases with age at the very time the insured sum reduces, resulting in a reduction to the amount paid.”
Lakey also welcomed Royal London’s increased focus on covering the significant impact on a family of pregnancy complications and the loss of a child pre-birth.
“This cover together with the congenital condition coverage of the enhanced policy serve to illustrate to the adviser the importance of getting this cover in place as soon as starting a family is being considered,” he added.