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Legal and regulatory update for the life and health insurance sector

Quality Product Research: legacy policy wording for life contracts

Quality Product Research is constantly approached about supplying legacy product research. Although this is a big task that requires a substantial investment, it is a project we are ready to undertake if we can find sufficient support. A legacy product is one that is no longer on-sale and is not covered by the enhancement pass-back or policy upgrade provisions. We have a library of more than 1,000 legacy policy documents and although some will have very few policyholders, the top 200 contracts may have more than 500,000 policies that remain in force.

In order to provide valuable research to our subscribers, we are reviewing insurer pass back dates to determine if an insurer:

  • Applies enhancements to past products with no limits (i.e., upgrades are applied to all clients with no restrictions)
  • Applies enhancements to past products with limits (i.e., insurer only applies upgrades to customers with a policy inception from 2010 etc)
  • Applies enhancements at the time of policy endorsement (with restrictions or not)

Please Download Insurer pass_back_2020_1-2 to find the most recent version of our pass back list which is currently under external consultation. This information was collected in collaboration with each insurer from 2019 to 2020 and we are interested in a comprehensive review of this. As well as our bullet points above, we would be interested in receiving the following from each insurer:

  • Any amendments that need to be made to our current record, with reference to the policy wording
  • How upgrades are communicated to customers for insurers that do not clearly state this information in their policy wording
  • Some insurers have disclosed that they currently have no pass back rule in policy wording however may pass back via policy endorsement. In this case, we would be interested in learning how frequently this is used

We are at an early stage in our thinking on this. Currently, we plan to offer a simplified form of legacy product research and to make it available perhaps exclusively to the larger adviser groups and insurers that would use it the most while we work on building up the ‘catalogue’ of researched legacy products.

Please email through any comments or information to us on researcher@qpresearch.co.nz

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