Maximum age at entry for males: Maximum age is fifth birthday before selected expiry age (for example, the overall maximum is 60th birthday).
Provider: The Children's Mutual
Product: Replacement Income Cover ' Essential Protection. Income Protection Insurance, with profits (Profit Share Account) and guaranteed premium rates. The Children's Mutual is a marketing name for Tunbridge Wells Equitable.
Minimum acceptable age at entry: 17 next birthday.
Minimum policy term: Minimum term of five years.
Retirement age 50 available: Cover can be selected to expire at 50, 55, 60 or 65th birthday.
Minimum annual benefit available: Benefit is expressed as a tax-free income payable monthly. The minimum benefit is £100 a month (£20 month minimum for extra benefit).
Maximum annual benefit available: The overall maximum benefit at outset is £5,000 a month, subject to the limitation referred to in benefit limits.
Additional Income Benefit Option ' if in work and earning enough to pay National Insurance contributions, an insured can choose to add this extra benefit to protect them in case they fail the medical tests to qualify for State Incapacity Benefit. The benefit is £250 per month (which will increase if a policyholder has chosen to protect the main benefit against inflation) and does not count towards the proportion of normal income received.
Additional income benefit is only paid while receiving the main income benefit under the policy. The deferred period for this benefit cannot be less than the shortest period for the main benefit and it must be at least 28 weeks (to coincide with the medical tests for State Incapacity benefit).
Premiums paid by direct debit: Premiums are collected by direct debit only. They may be paid monthly or annually.
Charge applied on policy surrender: Determined by actuary. If the policy is cancelled before the end of its term, an insured will be entitled to receive part of the profit share account, after a cancellation penalty has been applied. In the early years, this penalty would be equal to the value of the profit share account. Under current Inland Revenue practice, any payment would normally be tax free.
Female premium loading %: Separate rates apply to females. Loading ranges from 10% to 50%.
Increase premium amount during policy term: All benefits and options can be changed (subject to new underwriting for any increases in risk).
Decrease premium amount during policy term: All benefits and options can be changed (subject to new underwriting for any increases in risk).
Increase term after start date: All benefits and options can be changed (subject to new underwriting for any increases in risk).
Decrease term after start date: All benefits and options can be changed (subject to new underwriting for any increases in risk).
Increase benefit subject to underwriting: All benefits and options can be changed (subject to new underwriting for any increases in risk).
Decrease benefit subject to underwriting: All benefits and options can be changed (subject to new underwriting for any increases in risk).
Waiver of premium available: Yes ' this is a standard feature. The cost is included in the premium charge. The deferred period is the shortest chosen for the income benefit cover.
Premiums waived during benefit payment claim until recovery or attainment of chosen benefit expiry age, or death, whichever occurs first. Definition of disability is as for main income benefit. The deferred period begins from the first day of certified incapacity.
Notification period: For a deferred period of 13 weeks or less ' 21 days. For deferred period of 26 weeks or longer ' 56 days.
Maximum age at entry to include waiver benefit: 59 attained.
Benefit amount index linked: Benefits can be increased in line with inflation. Benefits and premiums payable for them will be increased without evidence of health, with effect from each policy anniversary. The increase is the same as any increase in the inflation index for the month six months before that policy anniversary over the equivalent index 18 months before that policy anniversary. If there has been no increase in the inflation index over that period, Tunbridge Wells will not increase the benefits or premiums on the policy anniversary.
A policyholder can choose not to have their benefits and premiums increased at any policy anniversary by giving written notice at least 10 working days before the anniversary. If this decision is made on three consecutive policy anniversaries, no further increases in benefits will be allowed under indexation.
Benefit amount and payments remain level at all times: Yes ' level option. Cover remains constant.
Guaranteed premium rates: Premiums are guaranteed not to increase in the future, unless indexation option has been chosen.
Career break available: If a policyholder chooses to stop working temporarily they can continue cover for up to three years and for up to a maximum benefit of £1,250 a month. Cover is based on the claims criteria that apply to a houseperson. The minimum deferred period is 13 weeks. Premiums will be adjusted accordingly.
Provided a policyholder starts working again at any time up to the end of the third year, benefit can be revived, up to the amount insured before the career break, without the need for any new information about health.
Evidence of income will need to be provided in order to revive the benefit at the end of the career break. The full amount of the previous benefit cannot be guaranteed if income changes, and premiums may need to be adjusted if a policyholder returns to a different job.
Houseperson cover available: If, immediately before the start of a period of certified incapacity:
• An insured is not normally and regularly engaged in, or are not
actively performing, a paid occupation.
• A career break is in force.
• Occupation is shown in the schedule or subsequent
endorsement as 'houseperson', then income benefit is
payable if, due to illness, disease or accidental injury,
an insured:
• Is confined continuously to a hospital or other recognised
medical establishment, or
• Cannot perform the normal range of housekeeping duties such as cooking, cleaning, shopping and child minding.
If benefit is payable, any deferred period is 13 weeks The maximum benefit is £1,250 a month. Houseperson cover is also available to those in part-time employment who earn less than £10,500 per year (gross). The same definition of disability in each case applies to waiver claims.
Rehabilitation benefit available: Rehabilitation benefit becomes payable if:
a) the society has paid income benefit for at least three consecutive months; and
b) an insured resumes the performance of either:
i) all or some of the usual duties of normal occupation(s) on a part-time basis up to (a) 25 hours per week or (b) 75% of normal average weekly working hours during the 12 months immediately before the period of certified incapacity began, whichever is lower; or
ii) only some of the principal duties and tasks of normal occupation(s) for normal average weekly working hours during the 12 months immediately before the period of certified incapacity began; but an insured cannot, because of illness, disease or accidental injury, perform such duties to any greater degree than described in (i) or (ii)above.
During the period for which Tunbridge Wells is paying rehabilitation benefit, an insured must give, at their own expense, such evidence that is reasonably requested of:
(a) continued inability to perform normal occupation(s) to any greater extent than that defined, and
(b) the income earned from partial performance of such occupation(s).
The company calculates the monthly amount of rehabilitation benefit in accordance with the formula:
Full benefit x (normal income - rehabilitation income)
• 'Full benefit' means the maximum monthly income benefit payable;
• 'Normal income' means one-twelfth of relevant income: and
• 'Rehabilitation income' means the average monthly income earned from normal occupation(s) following resumption of work on either basis.
Rehabilitation benefit is not payable for any period for which either income benefit or proportionate benefit is payable.
The maximum continuous period for which rehabilitation benefit is payable is one year.
Unemployment cover available: Becoming unemployed will not give rise to a claim for benefit.
Cover will continue but the policy provisions will change so as to provide cover as if insured as a houseperson.
The maximum benefit is £1,250 a month with a minimum deferred period of 13 weeks.
Death benefit available: The full value of an insured's profit share account is paid to their estate if they die before the policy ends, normally tax free.
Someone can be nominated to receive this benefit (up to £5,000) so they would not need to get probate of letters of administration first.
In addition, fatal accidental benefit can be added, at extra cost.
Maturity value available: Policyholders are entitled to a share of the profits made in the company's sickness fund. Each year the fund is reviewed and, provided it is in surplus, bonus rates are declared and allocated to a profit share account in an insured's name. Once bonuses are allocated, they cannot be taken away, if premiums are continued.
The value of the account can be claimed at or after the end of the insurance term. Payment is normally tax free, under current Inland Revenue practice.
Maximum % of income insurable: The benefits stated in the policy (plus any subsequent increases), or 50% of 'pre-incapacity earnings' up to £50,000 a year, plus 33% of any excess, whichever is less. The overall maximum benefit that can be insured at outset is £5,000 per month.
If insured as a houseperson, the maximum benefit that can be
insured at outset is £1,250 per month.
• Pre-incapacity earnings
If employed, this means pre-tax earnings for PAYE assessment purposes (excluding benefits in kind) in the 12 months which ended on 5 April before being unable to work. Any fluctuating income such as regular bonuses, commission or overtime is averaged over the three years which ended on that 5 April.
If self-employed, this means the share of pre-tax profit from trade, profession or vocation for the purposes of Schedule D Case I & II of the Income & Corporation Taxes Act 1988 (for example, share of pre-tax profit after deduction of trading expenses), averaged over the three years which ended on 5 April before becoming unable to work. If both are employed and self-employed, this means the total of pre-tax earnings and pre-tax profit as described above.
