Needs-matched life insurance provider, BrightRock, has announced enhancements to its temporary expenses cover – changes that, according to its CEO, Schalk Malan, it hopes will significantly benefit policyholders and filter through to the rest of the industry.
The enhancements include: the addition of new conditions to its list of clinical conditions; increased claims certainty for clients in specific occupations that, traditionally, may find it difficult to access coverage; and claim-stage choice between a pre-specified lump-sum or a recurring pay-out – a market first.
According to Malan, these additions to its needs-matched individual life offering come on the back of the strong uptake among financial advisers of its other market-first product features. BrightRock has particularly seen advisers and clients embrace its permanent expenses cover, with more lump-sum disability cover being placed with BrightRock than with any other insurer, according to the recently-released Swiss Re Individual Volume Survey for 2018. In fact, the annual survey found that advisers placed more non-occupational disability cover with BrightRock in 2018 than with the rest of the market combined in the large segment (sum assured greater than R2,4 million). BrightRock is now also ranked second in terms of market share of the large segment, sold through advisers
“While our temporary disability cover is already a market-leader, we believe the advancements we’ve introduced will make it the most comprehensive in the market. We hope to see it become the temporary disability cover of choice, similar to our permanent disability offering,” he said.
Unpacking these improvements to its temporary disability offering in more detail, Malan said: “We’re always looking at ways in which we can improve our product to help advisers create needs-matched solutions for their clients. We believe that the advancements we’ve made to our temporary disability cover will help them provide their clients with temporary expenses cover that is flexible, provides clients with claims certainty and gives them more cover for their premiums.”
Additions to BrightRock’s temporary expense needs cover
The enhancements below are available both to new business and to existing policyholders (applied retrospectively) from November, ensuring all BrightRock clients have access to these features.
• Increased claims certainty with the most extensive list of clinical conditions covered in the market: All BrightRock clients with temporary disability cover now have access to the most comprehensive list of clinical definitions in the market, with over 300 conditions covered – each with a specified guaranteed pay-out. The list includes surgeries, fractures, hospitalisation, pregnancy and childbirth complications and more. For example, a client who has a one-month waiting period on their policy and claims from their temporary expenses cover for a hip replacement, will receive a guaranteed pay-out for three months.
• Claim-stage choice between a lump-sum or recurring pay-out – a market first: BrightRock is the first provider in the market to allow clients to choose the best pay-out option at claim stage, when they know what their actual needs are. In addition to this, BrightRock will also waive clients’ waiting periods if they choose the lump-sum option.
“We introduced claim-stage choice under our permanent expenses cover, additional expense needs cover, and death cover when we launched our needs-matched product. It made sense to extend this flexibility, which allows clients to choose how they’d like to receive their pay-out – as recurring or stated lump-sum payment, or a combination of both – to our temporary disability cover, for guaranteed pay-outs under our clinical definitions,” says Malan.
• A one-month waiting period available for all occupations who qualify for temporary disability cover: Clients in manual occupations, such as animal breeders, massage therapists, hairdressers and personal trainers, will now have access to a one-month waiting period for a list of more than 300 clinical conditions. Before, these occupation groups would have had access to longer waiting periods of up to six months. This means that these clients can now have more claims certainty as they’d qualify for claims a lot sooner.
• Cover until stated cease date with dynamic waiting periods: Malan states that one of the biggest problems with temporary disability cover in the market is that clients’ cover doesn’t last as long as they expect it to. With some products in the market, clients’ cover will end on the policy anniversary before the client’s selected retirement age. This leaves clients exposed for up to a whole extra year as they approach retirement age.
According to Malan, clients face even greater uncertainty and financial exposure with products with an extended waiting period – such as extended income protection products with a 24-month waiting period. Where the waiting period on a benefit is equal to or longer than the time left to the cover cease date – up to two years – clients won’t be able to claim from their income protection benefit, as it will come to an end before they can claim. This is despite the fact that clients are charged a premium during this waiting period, believing that they do have cover.
“At BrightRock, our income protection cover behaves the way advisers and their clients expect it to. Our temporary and permanent expenses cover continues to at least when the client retires, as it ends on the policy anniversary after the client retires,” says Malan.
The company has also included a new dynamic waiting period that is applied to their temporary expenses cover. This innovative approach means that the applicable waiting period will reduce down to the next shortest waiting period as clients near their chosen retirement age. For example, a client with a three-month waiting period will get a two-month waiting period if they claim in the third-last month of their policy. In their second-last month, they’ll have a month-one waiting period, and in the last month, they’ll have a seven-day waiting period. All BrightRock clients have a seven-day waiting period in their last month of cover.
“BrightRock clients will always be able to claim on their temporary disability cover, no matter when they’re booked-off work,” Malan says.
• Proof of income not required at claim-stage: BrightRock doesn’t require proof of income at claim stage for claims under its clinical definitions if clients have already provided this proof at application stage. It also doesn’t require proof of income in the first six months of the claim for clients who’ve been booked-off work with a BrightRock Sick Note. “This provides our clients with even more certainty – it also reduces the administration hassle for them and their advisers,” Malan explains.
• Additional claims criteria with debt needs cover for retrenchment. BrightRock has also introduced a new debt instalment protector, which will pay up to 36 monthly payments, across multiple retrenchments. This new cover is available to clients who have taken out debt cover under their temporary expenses, permanent expenses and death cover (where the debt cover was ceded to a loan provider).
In discussing the new product features, Malan also underlined the importance of financial advisers in delivering needs-matched solutions to clients. According to Malan, face-to-face advice is proven to be the best way to give clients the most cover for their premiums. The Swiss Re Individual Volume Survey for 2018, independent financial advisers and tied agents help clients get between 1,2 and 4,2 times more cover for their premiums, compared to all other distribution channels.
“Our approach has always been geared towards supporting advisers’ best advice, allowing them to give their clients products that match their quality advice,” concludes Malan. “We believe these enhancements to our temporary expenses cover will equip advisers to offer clients temporary income protection that truly meets their needs – not just at the outset, but over their entire policy duration.”
This article was originally published on FANews on 18 October 2019. Click here to read the original online version.