On form

Over the last 12 months, the term 'credit crunch' has increasingly been mentioned in everyday conversations, whether discussing falling house prices, the rising cost of food and utility bills, mortgage interest rates or the difficulty in getting a mortgage. A percentage of the public are going to find hard times ahead.

According to many commentators, the economy is in severe danger of heading for recession yet with the Government's anticipated changes to the State incapacity benefits, even fewer people will be eligible for State assistance. Increasingly, people are being encouraged to take a greater interest in their finances and to make sure that they spend their money wisely.

So what does all this mean for the protection market? Arguably having appropriate protection cover in place is even more vital in the current economic environment.

Given the importance of maintaining an income in these difficult times, it will be even more obvious that income protection should be at the core of financial planning discussions for many consumers. Most financial advisers will be familiar with the statistics that show that customers are more likely to go off sick than suffer a critical illness or die.

However, what is often not appreciated is the effect that being out of work for a long period can have on an individual's future prospects.

Research by Professor Mansel Aylward director of Unum centre for psychosocial and disability research (CPDR) at Cardiff University has shown that being out of work can have a significant impact, not only on an individual's income, but also on their perceived self worth, their health and ultimately their life expectancy.

His research has shown that long term 'worklessness', - as Aylward terms it in order to distinguish from unemployment - can have some startling effects on individuals' health:

- Equivalent effect on life expectancy to smoking ten packets of cigarettes a day.

- A 40-fold increased risk of suicide in young men if they have been out of work for more than six months.

- A six-fold increased risk of suicide across the population for longer-term worklessness.

- Impact on health risk and life expectancy greater than many terminal diseases.

- Greater risk than the majority of the most dangerous jobs, for example construction, or working on an oil rig in the North Sea.

In order to address these real and, in the case of insurers, expensive problems a number of UK insurers, offer independent care advisory services as part of their protection policy benefits. Within these benefits both the customer and their immediate family are given access to a personal nurse adviser who can provide specialist medical advice and information, as well as emotional help and support at what is often a difficult and challenging time.

There are several companies that offer this facility in one form or another, among them Best Doctors, Bupa and Red Arc.

One-to-one

The nurse advisers dealing directly with the patients are at the heart of such service offerings and are able to commission services that are tailored to the individual and their family. In addition there are often specialist nurses available.

These services are becoming increasingly common for providers to add to their policies and are seen to be good ways to engage and retain clients. It is no longer the case where consumers are just looking for financial benefits. Instead they are now seeking to find what other benefits a provider can offer. In increasingly competitive markets, providers that take these extra steps will prosper in the long term as IFAs and their clients will remain loyal and see their policies as value for money.

Firms that offer these additional benefits are able to tailor services to individuals according to their needs. For example, a personal nurse adviser can arrange for a home visit by a nurse specialising in the particular health condition, like cancer. Alternatively, a course of therapy or a programme of specialist counselling may be arranged, free of charge.

More for your money

The Red Arc service model for example (see boxes to the left) offers value-added benefits that can make a difference to customers who need to claim. They are increasingly viewed as an important part of the product selection process and offer the industry a great opportunity to improve its image. Protection can, and should, be about more than simply paying a cheque.

The importance of this value-added benefit is summarised by Christina in the case study on the previous page who believes that this type of benefit would normally be something a consumer would pay for. "They weren't just doing their job, they made me feel so looked after that I felt extremely privileged," she said.

There is a growing provider requirement for these firms as the Government's move to Employee Support Allowance later on this year points towards a culture of capability, rather than one of disability, and patient-centric rehabilitation initiatives need to be at the core of the cultural change.

So when considering protection insurance solutions, both customers and advisers alike should look beyond the basic cover and what it costs, and explore the services available in the market.

The true value of these additional benefits will come home to roost when a person claims. While undoubtedly the focus will be on the financial repercussions of the policy payout, having add-on benefits to a policy will ensure that the protection industry demonstrates how it goes beyond the minimum requirement in the manner it deals with its clients.

Chris McFarlane is head of protection at LV=.

Case study

Christina, a 42-year-old recruitment manager from Birmingham, has used Red Arc in the past after she was diagnosed with breast cancer.

She had previously taken out a critical illness policy back in 2001.

In 2006, she claimed under her policy. Commenting on the service that she received from the firm, she said that when she contacted the insurance provider, a personal nurse adviser was in touch to explain what help was on offer.

Christina was impressed that the service was tailored to her individual needs.

"My personal nurse adviser became more like a friend to me. Each time we spoke, we summarised how I was feeling emotionally and physically, and then decided what the most appropriate time frame would be for us to speak again, or on any other help I might need."

The oncology nurses that helped her were also on hand to offer support and comfort throughout.

Psychological services

- Children

- Adults

- Elderly

Back to work services

- Website, phone, face-to-face

- CV writing, interview Q&As

- Advice on re-skilling, job search

Community nurses

- Home visits

- Assessment

- Aids for independent living

Counselling

- Stress, depression

- Victim/trauma

- Bereavement

Specialist nurse home visits

- Oncology

- Cardiology

- Neurology

Therapy

- Physiotherapy

- Occupational therapy

- Speech and language therapy

- Complementary therapy

24 hour/365 day helplines

- Medical

- Legal

- EAP

Specialist charities

- Organisations

- Self-help groups.