Scottish Widows has launched a flexible income protection product which it says is designed to be “simple and easy” to understand for established protection advisers, holistic advisers, and those who may be new to advising in this area.
The plan for the launch into income protection was first reported by Health & Protection back in 2022. The end of the project was a key factor in head of intermediary protection distribution, Alun Beynon’s decision to step down earlier this year.
Coinciding with the launch, the provider has joined the Income Protection Task Force.
It also has also become the fifth insurer to join CIExpert’s Income Protection Insight Zone and will be available to all CIExpert subscribers from today (8 October 2024).
Key product benefits of the new product include:
- Fracture and hospitalisation cover – included as standard with no extra charge.
- Rehabilitation/proportionate benefit – a top-up payment to help clients resume work.
- Partnership benefits where clients can benefit from a range of partnerships available through Scottish Widows Protect:
- Clinic in a Pocket – included in cover and which enables customers to receive a GP sick note quickly and access to a GP 24/7
- A dedicated personal nurse service in partnership with Red Arc.
- Immediate income payment – received while the claim is still being assessed, provided a GP note is supplied and once the deferred period has passed.
- Mental health underwriting – Scottish Widows says it will not decline an income protection application for mental health without an underwriting review conducted by a real person, rather than AI. It also asks the customer if they are doing anything to improve their condition, for example improved nutrition, sleep or exercise. Where customers are proactively taking steps to improve their mental health it can provide better underwriting rates.
- Price lock promise – guarantees the quote for up to 12 months, subject to underwriting terms being imposed.
- Reduced earnings with a minimum benefit guarantee, even if a client’s earnings have reduced, as long as their monthly claim payment is more than £1,500, Scottish Widows will not pay them less than this.
The launch enhances the suite of products available through the recently digitised Scottish Widows Protect platform and via the UnderwriteMe Protection Platform portal.
The product will be available on other protection portals in the coming weeks.
To reflect their changing needs, clients can amend conditions throughout the life of cover including the policy term, the deferred period, and the sum assured.
Flexible Income Protection also offers a risk review if health improves.
As part of the launch, Scottish Widows has joined the Income Protection Task Force (IPTF).
Scottish Widows has also joined CIEXpert’s Insight Zones.
Designed to support Consumer Duty requirements, Insight Zones give advisers access to key information on all aspects of critical illness and life propositions. The tool aims to enable advisers to streamline their protection sales and research processes.
Insight Zones offer advisers a view of all policy options. These include information of payment levels, maximum benefits, deferred periods, policy limits, claims data, limits, product flexibility, GIOs, smoker treatment and annual statements. Every Insight Zone is verified by the respective insurers to ensure accuracy.
Rose St Louis, protection director at Scottish Widows, (pictured) said: “Life doesn’t always go in a straight line and an unexpected adverse health event can have a significant impact on our ability to remain financially stable.
“This is where products like income protection can come to the rescue and have a meaningful impact in reducing income ‘troughs’ if you’re unable to work due to illness or disability.
“Launching Income Protection is part of our effort to help customers feel prepared, no matter what life throws at them.
“Our research shows women are less likely to have protection. We want to be part of the solution towards closing the gender protection gap while also making it easy for established protection writers, as well as those new to protection, to write this type of business.”
Jo Miller, co-chairwoman of the Income Protection Task Force, said: “The Income Protection Task Force (IPTF) welcomes Scottish Widows’ timely launch of their flexible Income Protection cover, addressing a critical issue highlighted by their recent research: a significant gender protection gap.
“This will support the pressing need for accessible and affordable income protection solutions.
“This product, designed for simplicity and flexibility, looks well positioned to help address these disparities and support a broader demographic.
“Additionally, integration of this product into the digitised Scottish Widows Protect platform should enhance the overall client experience.
“Scottish Widows’ membership of the IPTF signifies their long-term commitment to collaborative efforts aimed at expanding income protection coverage across the UK.
“We look forward to continued dialogue and initiatives that will drive greater awareness and adoption of income protection solutions.”