Quality Product Research: (Inbuilt) Child Trauma – Part Two 

A reader has queried whether QPR takes the sum insured into account in our Research Ratings.  And the answer is yes, we do consider the amount paid by each insurer. In fact amount paid are a vital part of a value-based assessment approach - and something we capture much better than simple feature lists of benefits do. 

In trauma insurance, some companies pay the full benefit for an item, others only make a payment of 10% or 20% of the sum insured because the condition was not severe enough to warrant a full payment. Our score is varied according to how much would actually be paid. In the scenario for Child Trauma, we have a claims amount of $100,000 and calculate how much would be paid out by each insurer.  

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Furthermore, based on adviser feedback we have corrected our ratings to reflect the fact that Asteron does include the option to convert their child cover to adult trauma at age 21. Interestingly, if the parent is on Trauma Recovery (TR) and considering converting their child cover to TR with Early Trauma they are required to complete an application. 

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Your feedback

We value getting your feedback on how these wordings are being applied to claims you may be aware of. Please email us with details of any recent claims to help us update our understanding. 

Doreen Dutt, Research Analyst, Quality Product Research Limited, researcher@qpresearch.co.nz


Quality Product Research: Diabetes Mellitus (Adult) – Part Two

Following on from our previous blog post regarding Diabetes Mellitus, we would like to clarify that in the case of Type 2 Diabetes, in general insurers do not pay out upon diagnosis of this condition, the insured is required to display severe complications such as irreversible retinopathy, diabetic gangrene and/or neuropathy to be eligible for a claim payment. Type 1 is less defined, but most insurers offer partial payments upon diagnosis once the insured person is over 30. We have therefore renamed this item to “Severe Diabetes” to reflect these related complications. 

We value getting your feedback on how these wordings are being applied to claims you may be aware of. Please email us with details of any recent claims to help us update our understanding. 

Doreen Dutt, Research Analyst, Quality Product Research Limited, researcher@qpresearch.co.nz


Merely stating facts is not enough

In research covering more than 6,000 claims for trauma conditions across greater than 2.6 million policy years, recorded claims causes show that cancer accounted for more than 40% of male claims and more than 70% of female claims. That's a huge share. It astonishes me that claims cause was not recorded for over 1,500 claims - but this gap in the data is more likely to be due to poor /legacy management information systems, than actually paying claims without a cause, it is unlikely to affect the ratio of claims causes. 

Consider another pair of facts: in a 30 year period a male non-smoker may have about a 16% (or one in six) chance of claiming on their trauma policy. Trauma claims enjoy a high claim payment rate - it varies, but in the UK a figure of greater than 90% is common. Now consider how they interact: there is about a 1.6% chance that this person will be unable to make a claim. Trauma insurance is a good bet. 

Clients, living their lives, have little or no idea about the risks and odds. It is up to someone to tell them. What's more, if you are basing product selection decisions on long lists of things that have little or no bearing on whether a claim will be payable then the information is true, but of limited use. Weighting the features by claims likelihood is essential to helping the client make an informed decision. 


Life price comparison database update

We have updated the life price comparison database, version 113, to reflect the changes to Cigna's pricing, which were extensive. Corporate subscribers should examine the update notes that have been sent with the database and the change report function. Advisers should check out comparisons on Quotemonster to see the effect of the changes which involved some increases - but also some notable decreases - which tended to favour larger cover amounts and the 90 day wait period for IP / MP. 


Quality Product Research: Proposed rating for Benign Brain and Spine Tumour

Introduction

The World Health Organisation states that 130 different types of brain tumours exist. A benign brain tumour is a non-cancerous growth in a distinct area of the brain. The survival rates for patients with benign brain tumours are higher than others, however this depends on the size and location of the tumour within the brain.

Proposed sub-items

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Notes

There are some noticeable differences between insurers such as whether partials exist, or if the spinal cord or tumour on the pituitary gland is covered. We have tried to make the sub-items clearly demonstrate the variation between insurers.

Why is this important?

Although QPRs weighting of this item is low, it would be of high interest to those that have a family history of brain cancers. With a lot of insurers now having specialised cancer products we would like to ensure that our rating is relevant. 

Your feedback

We value getting your feedback on how these wordings are being applied to claims you may be aware of. Please email us with details of any recent claims to help us update our understanding.

Doreen Dutt, Research Analyst, Quality Product Research Limited, researcher@qpresearch.co.nz


Cigna premiums to increase, and more daily news

Cigna has announced that from 15 April 2021 there will be changes to underlying premium rates on Life, Trauma and Disability covers across Assurance Extra, Business Assurance, Business Extra and Agribusiness Extra. Changes to Life, Trauma and Disability cover are a response to feedback and market developments. The price changes represent the changes. The price changes will be applied for new customers but current customers will have the new rates applied on their next premium review date after 15 April 2021. Applications that are submitted  before 15 April 2021 and issued before 15 May 2021 will not be immediately affected by the price changes. All changes are listed below:

 

·     Life cover rates on Assurance Extra, Business Assurance, Business Extra and Agribusiness Extra are increasing by 3% for yearly renewable, 5-year level and 10-year level premium structures.

·     Alongside this we’ve increased our large sum assured discounts for customers with over $500,000 of life cover.

·    Trauma cover on Assurance Extra, Business Assurance, Business Extra and Agribusiness Extra are increasing by 3% for yearly renewable premium structures.

·    Accelerated Complete Disablement Cover on Assurance Extra, Business Assurance and Agribusiness Extra are increasing by 3% for yearly renewable premium structures.

·    Disability covers including Income Cover, Mortgage Repayment Cover and Premium Cover are increasing dependent on factors including age, gender, wait period and benefit period. The increase will generally vary between 1-10%, however in some cases customers will experience a decrease.

 

“We wanted to give you a heads up about upcoming increases to the underlying premium rates on our current Life, Trauma and Disability Cover pricing across Assurance Extra, Business Assurance, Business Extra and Agribusiness Extra.

 

The new underlying rates will come into effect on 15 April 2021.

 

Over the past year in response to feedback, and in line with market developments, we’ve made a number of enhancements to our core Life, Trauma and Disability cover to make it easier for customers to access support when the unexpected happens.

 

These new competitive rates reflect the recent enhancements and will contribute to the long-term sustainability of our products while remaining good value for your customers.

 

For new customers: The refreshed rates come into effect on 15 April 2021 for all new policies.

 

For existing customers: The new rates will be applied to existing customers at their next premium review date from 15 April 2021. Customers will receive notification of their new premiums via the renewal letter which is sent prior to their premium review.

 

Any applications submitted before 15 April 2021 and issued before 15 May 2021 will be honoured at the old rates and will not be subject to the new rates until the first premium review.” Click here to read more 

In other news

FMA: the FMA has issued a public warning to Roger David Gannon of Gannon Insurance

Cigna: Simon Prentice to join Cigna as Business Partnership Manager based in lower South Island

Cigna: Sharon Duffell new Christchurch Senior Underwriter in the New Business & Underwriting Team

Cigna: Multi-Benefit Discount extended until 30 June 2021

 


Cigna announce product enhancements, and more daily news

Cigna has announced that they have enhanced aspects of Income, Mortgage Repayment, Complete Disablement, Trauma and Premium Covers. The enhancements include changes in wording and benefits. The changes were made effective as of 11 November 2020. The changes are designed to give customers more flexibility during the claims process as well as allowing customers with a low-grade tumor or a listed progressive conditions such as Alzheimer’s disease to claim.

“We’ve made enhancements to a number of definitions and benefits across our Income, Mortgage Repayment, Complete Disablement, Trauma and Premium Covers.

Among the changes is the addition of an alternative 10-hour disability definition to our base Income, Mortgage Repayment and Premium Covers. This will give your customers more flexibility when applying for a total disability claim.

The enhancements also include removing the severity requirements on the full Trauma benefit criteria, making it easier for your customers with a low-grade tumor or a listed progressive condition such as Alzheimer’s disease to claim.”

Below is a full list of benefit changes.

“We have made the following enhancements to our Assurance Extra Income Covers, Mortgage Repayment Cover and Premium Cover:

  • Adding an alternative (10 hour) Total Disability definition

Assurance Extra Income Cover, Mortgage Repayment Cover & Premium Cover

We’ve introduced an alternative total disability definition to our base covers where if an illness or injury causes the life assured to be unable to work more than 10 hours a week in their pre-disability occupation, they may still be considered for a Total Disability Benefit. Any income they’ve earned from working within these 10 hours, will be subtracted from the benefit amount payable.

  • Total Disability Benefit & Partial Disability Benefit –Removal of the 14 days & 7 days total disability criteria

Assurance Extra Income Cover & Mortgage Repayment Cover

We’ve removed the 14 days initial period of total disability criteria under our Total Disability Benefit, and the 7 days initial period of total disability criteria under our Partial Disability Benefit. This has improved the claim-ability of this cover, meaning the life assured is more likely to qualify for a claim payment.

  • Total Disability Benefit – removal of limitation for concurrent Mortgage Repayment Cover and Income Cover claims

Assurance Extra Income Cover

We’ve removed the limitation (added in April 2019) under all our Income Covers which reduces the Income Cover benefit after 6 months if the life assured is also getting a Mortgage Repayment Cover benefit for the same disability.

  • Recurrent Disability Benefit – Extending period of recurrence from 6 months to 12 months

Assurance Extra Income Cover, Mortgage Repayment Cover & Premium Cover

We’ve extended the period of recurrence to 12 months under all Assurance Extra Income Covers, Mortgage Repayment Cover and Premium Cover regardless of the selected payment term. Previously the period of recurrence had to be 6 months if a payment term of 2 years or 5 years was selected under Income Cover or Mortgage Repayment Cover.

  • Return to Work Benefit – adding an additional scenario for claim

Assurance Extra Income Cover & Mortgage Repayment Cover

We’ve added an additional scenario for claim, where, if the life assured has been accepted for a Vocational Retraining or Rehabilitation Benefit that resulted in them returning to full time employment or self-employment, they may now get extra financial support under the Return to Work Benefit

  • Premium Cover – Refund premiums paid during the waiting period upon acceptance of a Disability Benefit claim

Assurance Extra Premium Cover

Going forward, if a Disability Benefit claim has been accepted, the premium waiver would be applied retrospectively from the first day of the life assured’s disability. This means that at the end of the waiting period, we will reimburse any premiums paid in respect to coverage during the waiting period.

In other news

Does New Zealand really need four dispute resolution schemes?

Why do so many clients go without income protection?

nib: nib talks 2019/2020 results

 


Southern Cross launches Cancer Cover Plus, and more daily news

Southern Cross has announced the launch of Cancer Cover Plus. The new cover is intended to give members broader chemotherapy options. Cancer Cover Plus will give members the option to upgrade to Chemotherapy 100, which has a benefit limit of $100,000 or Chemotherapy 300 which has a benefit limit of $300,000. Additionally, members will have the choice to access non-Pharmac cancer drugs.

“Southern Cross Health Insurance (SCHI) is launching competitive cancer care cover to give members more choice when it comes to chemotherapy, including increased access to cancer drugs not subsidised by Pharmac.

SCHI’s new Cancer Cover Plus has two optional upgrades - Chemotherapy 100 (benefit limit of $100,000) and Chemotherapy 300 (benefit limit of $300,000) – to help members during their cancer treatment journey. This covers the cost of Pharmac and non-Pharmac, Medsafe indicated chemotherapy drugs and their administration for the treatment of cancer.”

Nick Astwick has said that the new cover has been designed with the needs of members in mind. Cancer Cover Plus has been developed to complement the unlimited surgical and radiotherapy benefits. Astwick notes that the cover was created so more New Zealanders have faster and more access to affordable cancer treatment options.

“We understand that a cancer diagnosis, or the fear of one, can be scary for people so we wanted to give members peace of mind by providing them with more cancer cover options.

 

“We have developed them to complement the unlimited surgical and radiotherapy benefits we offer in most of our plans, and this will help to provide a comprehensive package to the vast majority of our members who have these products and also tell us their main concern is cancer care,” he said.

 

The Southern Cross Healthy Futures Report 2020 revealed that 79 per cent of New Zealanders are concerned about not having access to cancer treatment services and 59 per cent are worried about experiencing or developing an illness or disease.

 

“Not all cancer drugs are funded by Pharmac which makes them unaffordable for many people. We created this new cancer cover so Kiwis could have faster access and more treatment options to receive potentially lifesaving chemotherapy drugs if they need to,” said Astwick.” 

In other news:

At goodreturns: Adviser consultancy firms say full licensing provisions bring mandate for change

From Partners Life: Do your self-employed clients have the right income cover? 


Cigna: multi-benefit discount campaign details

Cigna has announced a multi-benefit discount campaign for customers over 30. The discounts applies to all new Assurance Extra policies issued on or after 9 September 2020. Depending on a customer’s age and the number of qualifying benefits they choose to take up alongside their Life or Life Income Cover, the discount amount will vary. As a result, policies with multiple people may have different levels of discounts applied. Alternatively, a single policy may only have discounts applied to certain covers.

The discounts available are:

  • 3% for customers aged 30-39 who take out LIFE + one or more other qualifying benefit
  • 5% for customers aged 40+ who take out LIFE + one other qualifying benefit
  • 7% for customers aged 40+ who take out LIFE + two or more other qualifying benefits

To be eligible customers must have a Life Cover in place and have a minimum sum insured amount of $200,000 and have a minimum of one qualifying cover.  Covers selected from the same group will be considered as one qualifying benefit in the discount calculations. Please refer to the table below for more details.

Selection

Benefit Group

Minimum Sum Insured

Covers that qualifies under the benefit group

Mandatory

LIFE

$200,000

Life Cover

Life Income Cover*

Optional

TRAUMA

$100,000

Trauma Cover - accelerated

Trauma Cover - standalone

COMPLETEDISABLE

$200,000

Complete Disablement Cover - accelerated

Complete Disablement Cover - standalone

MONTHLY DISABILITY

$2,000 per month

Income Cover - Agreed Value

Income Cover - Indemnity

Income Cover - Loss of Earnings

Income Cover - Loss of Earnings Ultra

Mortgage Repayment Cover

 


Product database updated

The QPR database has been updated and version 136 has been issued to subscribers and all changes are now live on Quotemonster. This version of the database includes the following changes:

Pinnacle Life policy wordings updated:

IP version 16/10/2018

Life version 01/12/2019

Funeral version 23/01/2019

Trauma version 01/12/2019

- no rating changes

 

Cigna business wording 11/05/2020 updated and rating changes applied. Revisions to ratings:

- IP/MP:

Future Insurability + Redundancy max entry/exit ages for Cigna

Pregnancy Premium Waiver Gender for Cigna

Insurable Income - SE rating for Partners Life

Insurable Income Salaried + SE amount score review

- Trauma:

> Diabetes Mellitus Adult definition, min age and amount score for Cigna

> Multiple Sclerosis definition review