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


Daily news update: Cigna price changes introduced, and more stories

Cigna has made price changes to a number of products. The range of the changes are detailed in the table below. You can tell from the variety of changes that this is a complete repricing exercise - not merely an increase or decrease of a blanket percentage. Some prices will be much more competitive. Some segments are being increased. The only way to know for certain, is to do a comparison for each life. That's why a price comparison across the market is vital if you wish to offer help to clients seeking the most competitive products. Quotemonster still offers free price comparisons for financial advisers with an FSP number and an email account. 

YRT Life

11/05/2020

From -12% to +8%

Level Life

11/05/2020

From -24% to +1% Non-Smokers & Female Smokers, from -17% to +8% Male Smokers

Trauma

11/05/2020

From -13% to +10% Non-Smokers & -3% to +15% Smokers

Level Trauma

11/05/2020

From -16% to +10% Non-Smokers, -16% to +18% Smokers

Income Protection

11/05/2020

From -1% to -2%

Mortgage Protection

11/05/2020

From + 5% to +25% Female, from +7% to +20% Male. As per discussion, indexation was previously offered free for the first year.

In other news:

AIA: Mentemia, a mental wellbeing app, is now part of the AIA Vitality program.

AIA: Clients can get one month’s premium free when they apply for a new eligible AIA policy between 5 March 2020 and 31 May 2020 and have the policy issued by 31 July 2020.

Partners Life: The automatic COVID-19 Mental Health exclusion that was applied to disability and business risk benefits has been replaced with more targeted and specific underwriting processes.

Partners Life: Clients who had the automatic mental health exclusion applied will have it replaced with an emergent mental health exclusion.

Partners Life: Underwriting restrictions 2020


COVID-19 Crisis will have diverse impacts on health and insurers

Members of parliament listened to the stories New Zealanders shared about their struggles and hardship during an Epidemic Response Committee meeting recently. No accounting of costs and benefits can be done in full for some years. The purpose of this post is not to attempt that. I acknowledge that a trade-off was made between the numbers that would become sick and die directly from COVID-19, indirectly from a poorly-managed response to the epidemic, against those that may suffer a similar fate because of restrictions due to the control measures. On balance, I prefer the control measures taken - as severely negative effects (more sickness and more death) are associated with a range of alternatives. However, the purpose of this post is rather to explore the impact on customers of insurance companies, and therefore the likely claim impact on insurers.

 

Death claims are much higher in markets where there has been a delayed or poorly managed response to the epidemic. Take the example of Lombardy, detailed in this news. Deaths from out of hospital cardiac arrests rose sharply, as people deferred or tried to avoid treatment, and possibly, some were simply unable to receive emergency treatment in time. Cancer treatment would likely have been affected similarly - as it has been in the UK, with some patients missing chemotherapy appointments, probably, in part, due to fear of visiting hospitals where there are a lot of COVID-19 patients. These all have an impact on insurers - as shown in these reported results from Europe: pandemic takes its toll on insurers’ first quarter results.

 

But that doesn't mean we have avoided all the negative effects of the pandemic. Various tests and treatment were deferred to ensure sufficient capacity in hospitals for the epidemic and they will take time to restart, let alone catch up. See: some DHBs weeks away from restarting breast cancer screening. Take cancer care: delays in diagnosis and treatment, for example, are likely to have some effects. In this news piece one patient explains the treatment delay and how they are now seeking treatment privately so that they will not have to wait. Inevitably in a large pool of people where diagnosis and treatment are delayed there will be some increase in cancers at a later stage and some increase in deaths. The difference between the effect of death claims from COVID-19 and those that may arise due to treatment delays is probably in three dimensions, time, scale, and age of the person affected. A COVID-19 death would tend to happen quickly, soon after the time of infection, compared to the cancer death that will emerge over a period of up to two years. The age of the person affected is likely to be younger, but the scale of people affected should be much smaller than the numbers that could have been affected by an un-managed outbreak. 

 

Three scenarios can be constructed. One was the expected claims budget for 2020 before the pandemic. It is the budget baseline. Then there is the possible scenario without effective management. Then there is the likely current scenario compared to the baseline. It seems clear that the 'saving' due to lower death claims from COVID-19 is probably large. But it not clear that the small reduction in deaths and injury due to fewer road accidents and workplace deaths may not be sufficient to off-set the other indirect affects of the COVID-19 crisis. At present, as explored in this blog post, the death rate is running slightly above last year. I think I would still expect higher claims for 2020 for life, trauma, and IP products as per this post. 

 

In other news:

Pandemic will reset all markets, economist says

Pricing strategy – choices and their meanings

Australia: Financial planners have proven incapable of self-regulation, but can FASEA stop the client rorts?

 

 


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.

FSC Launches new insurance research

The Financial Services Council has launched new insurance research highlighting the gap between typical and ideal cover levels and some significant challenges facing the industry in lifting consumer engagement.

In the media release the CEO of the FSC, Richard Klipin, highlighted the purpose and key findings: 

The study looked at the three main types of life insurance available in New Zealand; life insurance, income protection/mortgage repayment insurance and critical illness insurance. “While 54% of those surveyed agree that it is important to have the right amount of insurance to cover risks including illness, death and job loss; estimates of underinsurance are much higher,” continued Klipin. Critical illness showed the highest level of underinsurance with only an estimated 9% of Kiwi’s being sufficiently insured, followed by 11% who had adequate income protection/mortgage repayment insurance and 29% with adequate life insurance.

Consumer views are included in this introductory video: 

 

Gambling on life 2020-01-22 164052

The research can be viewed here


Product and pricing changes for OnePath, nib, Asteron Life, Southern Cross, AIA and Sovereign

An absolutely huge couple of weeks of changes: 

Pricing:

  • Updated OnePath Mortgage Protection Prices effective 1 July
  • Updated nib health prices effective 1 July
  • Updated Southern Cross health prices effective 1 July
  • Updated Asteron Life and Trauma rates effective 1 July

New Features:

  • Needs Analysis – added Standalone and Accelerated options for existing Trauma and TPD insurance
  • Research report – added a new page at the end explaining the QPR Research methodology

Research:

Completed a big set of changes, with some quite substantial shifts (see more posts later today and next week)

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Eligibility rules:

  • OnePath - Income Protection, Mortgage Protection and Trauma - changes in entry ages
  • OnePath - Income Protection - age limit changed

Cancer-stricken business owner struggling to sell Auckland restaurant for third of purchase price

Breast cancer patient Kingna Yu tells her story of struggling financially as she loses money on her Auckland business due to City Rail works taking place in front of her store. She has put breast reconstruction surgery on hold while she waits to see if there is a chance to get compensation for the decline in business. Click here to read more.

This is a desperately sad situation which shows the value of having a buffer against events - and if that buffer cannot be cash, it could be insurance. Of course, there is no way of knowing exactly what this person's situation was - so just to acknowledge that may not have been possible for them. 


Asteron Life - Continous Trauma

Asteron Life have made a claim for real innovation by launching their new continuous trauma benefit. There are some details to get across, and you can read about those in the link below. But the essence of the number of the product enhancement is that with this optional add on, trauma automatically reinstates immediately after a claim.It is the automatic nature that I think is really powerful. I shall be taking a closer look at pricing and seeing how that works. too.

The new Trauma Continuous Benefit came into effect 3 September 2018. Click here to see details:  Download Asteron Life product enhancements from 03Sep2018