Legal & General introduces income guarantee, premium discount for exclusions due to spine and mental illness to be introduced and state benefits no longer deducted from monthly claims
Legal & General has launched an all new and improved Income Protection Benefit (IPB) product and announced it is to offer more occupations the superior own occupation definition. The aim of the plan is to help protect against the potential impact illness or incapacity may have on an individual’s income and lifestyle.
The changes follow a full strategic review of IPB, which included a request for distribution feedback from Legal & General’s IFA division, Banks and Building Societies, Legal & General Network and other key stakeholders. Intensive analysis of those results as well as feedback and research from consumers and advisers has led to the following headline improvements:
- All customers in occupation classes 1, 2, 3 and 4 will be covered for their own occupation
- Income guarantee to be introduced for the lesser of £1,500 or the monthly benefit amount specified in the policy schedule
- State benefits will no longer be deducted from monthly benefit payments
- 5% premium discount for all full spinal and mental illness exclusions and 3% on partial spinal exclusions
Georgina Shield, Senior Product Manager for Income Protection Benefit, Legal & General Protection says: “We continually strive to improve our products wherever we can and there is a strong desire to offer customers a fair policy that provides them with the cover they require and expect from the outset.
“Put simply, if a claim is made under Life or Critical Illness Cover the policy pays out the expected amount However, if the life assured became ill or incapacitated our previous IPB policy sometimes saw claimants get a lower benefit than they expected. We wanted to put that right and this product does just that.
“Georgina Shield at Legal & General continues: “Ultimately we are committed to providing our customers with the best income protection product we can. Our research confirms that complexity of the product can sometimes create confusion for the consumer so therefore, advice remains a key part of the purchase process. Our hope is that these improvements and our supporting material will help advisers and consumers to make informed and well researched decisions.”
Peter Le Beau, Chairman of the Income Protection Task Force said: “I am delighted to see Legal & General being prepared to take income protection very seriously. Their new product looks very competitive and a lot of thought has gone into developing areas where there was room for improvement like the extension of the own occupation definition and the Income Guarantee. I also like their openness over claims disclosure. I think this has a very positive influence on other leading offices.”