Fidelity Life has issued underwriting guidance. This is valuable as underwriting on a case by case basis is required, providing guidance helps advisers and clients know what to expect:
"New underwriting guidelines
Industries like travel, tourism, import/export, hospitality and retail will be particularly hard hit by Covid-19. On the other hand essential services like supermarkets and food producers, for example, will be largely unaffected.
The good news is at this time there’s still no need to put any broad, mandatory policy exclusions in place. And to be clear we’re still taking a case-by-case underwriting approach.
But, following discussions with our reinsurers, we’ve now introduced some new underwriting guidelines to ensure we’re consistent, particularly with disability cover and with individuals, occupations and industries impacted by Covid-19.
The guidelines include:
• postponing certain new business applications
• limiting maximum cover levels
• reintroducing an underwriting questionnaire
We’re not sure how long we’ll need to keep these guidelines in place but we’ll continuously review our position and let you know as soon as anything changes.
We want to help customers get disability cover
With the exception of Redundancy Cover all our products remain on sale.
With disability cover we’re committed to working with you to help customers get cover wherever possible. This means:
• We can still offer disability cover to many industries and individuals. We may also be able to underwrite agreed value benefits where there’s no change to duties, income or hours worked as a result of Covid-19
• We may be able to offer disability cover to individuals whose income could be impacted by Covid-19 by considering indemnity value benefits or limiting the benefit period. Wherever we can, we will look at options to provide cover
• We’re happy to include salaries and wages into income calculations, however in the present environment we can’t consider bonuses or commission payments"
Those income protection changes amount to a substantial change in policy. Given Treasury forecasts for the economy through to the end of 2021 I would not expect a return to pre-crisis IP underwriting in the near term, and perhaps, never.
More details can be found at this link: https://advisers.fidelitylife.co.nz/media/q4nb13jv/fidelity-life-underwriting-guidelines-22-april-2020.pdf