Partners Life: Underwriting for COVID-19 financial risks

Partners Life are remaining open to new business during this uncertain time of COVID-19 but have announced a number of restrictions to IP, MP, and TPD, while placing a minimum 6 month stand-down for eligibility for Premium Holiday and Policy Suspension claims. Stating ‘As soon as we are able to remove these restrictions for new business, we will contact those advisers and clients affected directly to review and/or remove these restrictions for any policies issued during this interim period.’

Here is more information:

  1. No new Loss of Revenue Cover or Variable Loss of Revenue Cover benefits will be issued. The cover will be deferred.
     
  2. No new Agreed Value benefits based on Income will be issued. This includes Income Covers, Mortgage Repayment and Household Expenses benefit which are to be based on income. Indemnity Loss of Earnings Income Cover will be offered as an alternative by way of Offer of Terms.
     
  3. MRC and HEC based on actual mortgage repayments and expenses will still be allowed.
     
  4. Disability benefits of any kind will have a Mental health exclusion applied by way of Offer of Terms. This includes lump sum benefits which cover disability such as TPD, Trauma Cover and Hybrid Business Benefits.
     
  5. Disability benefits of any kind will have a restriction for disability first arising while a life assured is unemployed or is on a period of leave without pay. This includes lump sum benefits which cover disability such as TPD, Trauma Cover and Hybrid Business Benefits.

    These lives assured will instead be considered an Occupation Class 5 immediately they stop work rather than after the usual 12 month period. This restriction will be achieved by way of an Offer of Terms.
     
  6. All new policies to be issued will include a minimum 6 month stand-down for eligibility for Premium Holiday and Policy Suspension claims. This restriction which will be achieved by way of Offer of Terms.

Partners Life - Naomi Ballantyne talks about change

In a video message Naomi Ballantyne has provided an update on various changes due to the current COVID-19 crisis. This message covers premium increases, premium suspensions available for current clients, changes to what is offered to clients in the pipeline, over-ride for financial advice providers, comments on rumours shareholder and reinsurer pressure. and about  and an encouragement to take decisions, even in an environment where one has imperfect information. https://player.vimeo.com/video/400462246 


Partners Life and Cigna offer claims reassurance

As most people cancel their life and trauma insurance before retiring, the majority of life and trauma policyholders are younger and more likely to survive COVID-19. For this reason, life insurers are not expecting an increase in claims as a result of COVID-19. In this article both Partners Life and Cigna confirm that they have pandemic insurance in place, but also remind customers that they have relatively low levels of insurance on those that are most likely to be affected. Click here to read more :

"From a claims point of view, we don't believe it will come across in our claims experience on the types of products we sell," said Naomi Ballantyne, founder and managing director of Partners Life.

Most people cancelled their life and trauma insurance long before they retired, meaning most policyholders were younger, and had a very high likelihood of surviving a Covid-19 should they be infected.

I expect all New Zealand life and health insurers are in good shape to meet all claims.


Partners Life Sponsor NZ Rainbow Excellence Awards

The 2020 New Zealand Rainbow Excellence Awards are being held on the 1st of May at the Aotea Centre in Auckland. The idea of the evening is to celebrate: workplace leadership, innovation, best practice, and collaboration. Click here to read more. Partners Life are sponsoring an emerging leader category - for organisations at the start of their journey in fostering diversity. For smaller businesses that have fewer full-time HR staff, but maybe one or two individuals motivated to tell their diversity story this may be an opportunity. 

 


Life insurers reassurance on expected impact of Covid-19

Partners Life has made an announcement reassuring clients and advisers about the potential impact of Covid-19: 

All of our products provide guaranteed terms and conditions, meaning existing clients maintain their current coverage irrespective of the impact of COVID-19. 

In the seemingly unlikely event of a significant deterioration in claims experience as a result of COVID-19, Partners Life would call against its Pandemic Insurance and/or would re-price accordingly. In respect of re-pricing Partners Life could offer an affordability option for clients to voluntarily exclude claims arising from COVID-19 in exchange for a premium discount.

Our understanding of the medical risk of COVID-19
For infants, children and healthy adults, the medical impact of contracting COVID-19 does not appear to be discernibly different from any previously known forms of the flu virus.

The most significant impacts seem to have been occurring in vulnerable adults, being those with serious underlying health issues and/or those that are over the age of 70 with age related frailties.

Our products
Partners Life products are designed to be claimable on in the event of a major health interruption. There is no product in our product suite that would be claimable in the event of a limited respiratory viral infection, which does not result in a major health interruption.

Our potential new clients
Partners Life applicants must be NZ citizens, permanent residents or on long-term work permits. Temporary visitors cannot apply for Partners Life benefits.

The insured population in NZ is largely made up of lives assured who have insurance requirements to support dependent family members and/or employees and/or to repay debt.  Older members of the public who no longer have dependents or debt are far less likely to hold insurance benefits. In addition, maximum age limits which apply to all products in the Partners Life range would further prevent an increase of applications for this at risk population.

Applicants for risk benefits with Partners Life are always underwritten to determine their specific health risk profile before being accepted for insurance. It is therefore very unlikely that people with health issues that would make them particularly susceptible to serious consequences resulting from a viral illness (including but not limited to COVID-19) would be accepted for coverage under Partners Life benefits.

Applicants who have contracted COVID-19 prior to applying for cover, and require medical testing or treatment for it, are required to disclose this information as part of their personal statement and will be underwritten accordingly. Anyone who does not disclose correctly will be subject to the usual consequences of non-disclosure should a claim arise.

As a result, Partners Life does not believe that the new business applicant population for Partners Life products will be significantly exposed to any increased risk of health interruption claims arising from the current COVID-19 pandemic. We do not, therefore, believe anything further than our standard application and health underwriting processes are required at this stage.


Partners Life IP product restrictions for self-employed clients

In conjunction with the price increases Partners Life has introduced a package of product restrictions for self-employed clients: 

Monthly Disability Benefits

Changes for self-employed clients (new business only)

As discussed in our recent Executive Insights podcast episode, Partners Life has identified self-employed clients as a client segment which is disproportionately, adversely impacting our disability claims experience. By self-employed we mean sole traders, small business owners and self-employed contractors (excluding part-time self-employed clients who fall into the Class 5 occupation category).

Pricing increases can help address this experience for existing clients, however in order to avoid continuous general price increases into the future, we believe it is prudent to stop compounding
the issue by changing the types of new business that we offer to this client segment. As a result, we have adopted a strategy to minimise access to self-employed clients to some of the more obvious over-insurance components inherent in current monthly disability products.

From 5 April 2020 onwards, the following changes will apply to all new business quoted and issued for Income Cover, Mortgage Repayment Cover and Household Expenses Cover for self employed clients:

Changes for Self-Employed Applicants for IC, MRC and HEC Indemnity Loss of Earnings Income Cover benefits only will be available – i.e. Agreed Value Income Cover benefits of any kind will no longer be available;

and A mandatory Waiting Period of 4 weeks will apply – no other waiting period options will be available; and Pre-disability Income will be re-defined to be based on the most recently completed annual financials immediately prior to the date of disability, rather than being based on the best consecutive 12 months over the previous 3 years;

and Mortgage Repayment and Household Expenses Cover sums assured for self-employed clients can only be based on actual mortgage or actual household expenses – the percentage of income basis will no longer be available; and A new Payment Term Restriction Option will replace the previous Mental Health Payment Term Restriction Option which was available under Income Cover (generating a 10% premium discount). Under this replacement Payment Term Restriction Option, the list of claim causes for which a reduced 1-year maximum payment term will apply has been extended from mental health causes alone to include any claim cause for which symptoms and impacts are predominantly self-reported rather than medically evidenced. This option can now also be taken for MRC and HEC benefits. This 1-year Payment Term Restriction Option (and the corresponding 10% premium discount) will be mandatory for self-employed clients for all IC, MRC and HEC benefits.

A rating update is being discussed with Quality Product Research and will be available before the date of the change, and served on the site appropriately based on the employment status of the client - making it more important than ever before that you correctly enter the client detail as either employed or self-employed. 


Partners Life: Premium Increases

Partners Life have announced:

Having completed a routine review of emerging claims experience across our entire risk product range and considering medical inflation as it relates to Private Medical Cover, we have determined that the following underlying price increases will take effect from 5 April 2020, for premium structures other than Guaranteed Level.

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Partners Life professional development sessions for advisers

Partners Life are committed to offering professional development opportunities to advisers.

Tauranga

Date: Tuesday 18th February

Time: 9.00am - 11.00am

Location: Trinity Wharf

51 Dive Crescent

Tauranga

Hamilton

Date: Tuesday 18th February

Time: 2.00pm - 4.00pm

Location: Waikato Stadium

Gate 5, 128 Seddon Road

Hamilton

Auckland North

Date: Wednesday 19th February

Time: 9.00am - 11.00am

Location: Bruce Mason Centre

1 The Promenade

Takapuna

Auckland South

Date: Thursday 20th February

Time: 9.00am - 11.00am

Location: Ellerslie Event Centre

80 Ascot Avenue

Remuera

Napier

Date: Monday 24th February

Time: 9.00am - 11.00am

Location: Mission Estate

198 Church Road

Taradale

Palmerston North

Date: Tuesday 25th February

Time: 9.00am - 11.00am

Location: Coachman Hotel

140 Fitzherbert Avenue

Palmerston North

New Plymouth

Date: Wednesday 26th February

Time: 9.00am - 11.00am

Location: Devon Hotel

390 Devon Street East

Strandon

Dunedin

Date: Tuesday 3rd March

Time: 9.00am - 11.00am

Location: Scenic Hotel Southern Cross

118 High Street

Dunedin

Invercargill

Date: Tuesday 3rd March

Time: 2.00pm - 4.00pm

Location: BNZ Partners Centre

Level 1, 84 Esk Street

Invercargill

Christchurch

Date: Wednesday 4th March

Time: 9.00am - 11.00am

Location: Addington Event Centre

75 Jack Hinton Drive

Christchurch

Wellington

Date: Thursday 5th March

Time: 10.00am - 12.00pm

Location: QT Hotel

90 Cable Street

Te Aro

Nelson

Date: Friday 6th March

Time: 10.00am - 12.00pm

Location: Rutherford Hotel

27 Nile Street W

Trafalgar Square

Queenstown

Date: Wednesday 11th March

Time: 11.00am - 1.00pm

Location: BNZ Partners Centre

11 Rees Street

Queenstown

 

Click here to RSVP