Legal & General has launched a PMI product with the aim of rewarding loyal customers by helping to s...
Legal & General has launched a PMI product with the aim of rewarding loyal customers by helping to subsidise the future costs of cover.
The Healthcare Rewards scheme will reward the policyholder every three years with a loyalty reward and a no claims bonus. If a policyholder makes a claim within a three-year period, they lose their NCB but can still be awarded their loyalty reward. The policyholder can use their entitlement in three different ways on their policy, including taking a discount in the cost of cover for the next three years.
Alternatively, the policyholder may wish to take a payment holiday for a number of months or they may opt for a refund of premiums.
Cover under the plan includes a full refund for inpatient and day care, hospital costs and surgeons'/anaesthetists' fees, a full refund for follow-up outpatient treatment up to three months from leaving hospital and a full refund for parent accommodation and private ambulance. Outpatient cover, specialist consultants, tests, x-rays, pathology and physiotherapy are limited to £750pa, this includes up to six sessions of physiotherapy.
Premiums are calculated individually, according to age. Policyholders may choose to either have the premium increased annually, or opt for a fixed increase every three years.
A couple aged 40 opting for a £200 excess under the 5%pa increase option, will pay £1,277 in year one, £1,341 in year two and £1,408 in year three. This will entitle them to either a premium holiday of two months in the following year, a premium discount of 6.7% for the next three years or a refund in premiums of £362, if they do not claim during this period. If they do claim they will still be entitled to a loyalty reward equating to one month's premium holiday, a 4.5% discount for the next three years or a refund of £242.
Payment protection is automatically included within the cost, providing payments of the premium for up to 12 months, should accident, sickness or unemployment prevent the policyholder from working for more than 30 days.
The policy also provides the option of a choice of three voluntary excesses to help reduce the premium. The standard excess is £100, but if the policyholder opts to increase this to £200, then they will enjoy a 7.5% discount. A £400 excess will provide a discount of 15% and a £1,000 excess will provide a 40% premium discount.
Andy Sampson, head of planning and research at L&G, said: "It is the combination of loyalty reward, NCB and payment protection within the price which makes this policy unique and perfect for the two markets we are aiming at - those with young families and those closer to retirement."
Commission rates are 40% initial and 7.5% renewal.
l For more details see product analysis on pages 50-51.
