Provider: Scottish Amicable Product: Mortgage Protection Plan. The plan is a level or reducing...
Provider: Scottish Amicable
Product: Mortgage Protection Plan.
The plan is a level or reducing term assurance, available on a single or joint life first death basis, designed to provide low cost life assurance protection during the term of a mortgage with critical illness cover, income protection, waiver of premium and unemployment cover also available.
Minimum acceptance age at commencement: 16
Minimum age attained at entry with unemployment cover: 18
Maximum acceptance age at commencement: 79 if no additional benefits are included. 69 if critical illness cover is included. 59 if unemployment cover is included. 54 if waiver of premium and mortgage payment benefit are included.
Minimum policy term: Five years
Maximum expiry age: 90
Maximum term (yrs): 40 years or to maximum ages
Minimum acceptable monthly premium: Minimum monthly premium is £5 per month or £50 per year.
Guaranteed premium rates: All rates are guaranteed for policy terms except premiums for unemployment cover.
Maximum mortgage interest rate: If the policy holder has chosen the decreasing life cover option to protect a mortgage and mortgage interest rates rise above 12% per annum, the amount payable on a claim may be less than the outstanding loan.
Premiums paid by direct debit: Yes ' monthly and annually.
Premiums paid by cheque: Yes ' annually only.
Single life plan available: Yes
Joint life first death plan available: Yes
Monthly policy fee: £2.50
Waiver of premium available: Yes. Waiver of premium will pay the plan holders mortgage protection payments if they are off work due to illness or injury. The plan will pay out after a deferred period chosen by the plan holder at the start of the plan either three, six or 12 months.
There are three possible definitions of incapacity for waiver of premium benefit and mortgage payment benefit.
• Standard definition of incapacity: Totally unable as a result of an illness or injury, to engage for profit or reward in the occupation in which he was engaged immediately prior to the start of that illness or injury.
• Special definition of incapacity: Totally unable, as a result of an illness or injury, to engage in any employment or occupation whatsoever for profit or reward.
• Activities of daily living: Definition of incapacity (available at claims stage for housewives, house husbands, for example). Confirmation by a consultant physician of the inability of the life assured to perform at least three of the following activities of daily living:
• Continence: the ability to manage bowel and bladder functions such that an adequate level of personal hygiene can be maintained.
• Dressing: the ability to put on, take off, secure and unfasten all garments and any braces, artificial limbs or other surgical appliances.
• Feeding: the ability to feed oneself once food and drink have been prepared and made available.
• Mobility: the ability to move from one room to another in the insured's normal place of residence.
• Transferring: the ability to move from a bed to an upright chair of wheelchair, and vice versa.
• Washing: the ability to wash in the bath or shower (including getting into and out of the bath or shower) such that an adequate level of personal hygiene can be maintained.
Unemployment cover option: Yes, unemployment cover gives the plan holder a fixed monthly payment and pays the mortgage protection payments if the plan holder becomes unemployed or cease trading (if self employed), through no fault of their own. Benefit is payable for a maximum of 52 weeks.
The plan will pay out after a deferred period, that is four or 13 weeks, chosen by the plan holder at the start of the plan, if they are made unemployed.
For plans covering a new mortgage there is a 30-day initial waiting period from the start of the plan to when a claim can be made. Where the cover is for an existing mortgage the initial waiting period is 90 days. This cover is provided under a separate insurance policy issued by the Prudential Assurance Company Limited.
Guaranteed insurability on marriage: Yes, up to 50% of initial level of cover, subject to a maximum of
£150,000. Maximum age 50 next birthday.
Guaranteed insurability on moving house/ increase in mortgage: Yes, provided via a new policy.
Maximum age to exercise house option: 50
Maximum increase available for house option: Yes, up to a maximum of the increase in the mortgage loan amount, subject to an overall maximum of £150,000 cover on the additional policy. Maximum age 50 next birthday.
Guaranteed insurability on childbirth or adoption: Yes, cover can be increased by up to 50% of the initial level of cover, subject to a maximum of £150,000. Maximum age 50 next birthday.
Option to increase sum assured: Yes, the life assurance can be increased at any time during the term of the plan. Any increase in cover will be provided by an increment plan, subject to satisfactory evidence of continued good health.
Option to decrease sum assured: Yes, the life assurance can be decreased at any time during the term of the plan.
Terminal illness included automatically: Terminal illness is automatically included, the definition of terminal illness is 'advanced or rapidly progressing incurable illness where, in the opinion of an attending consultant and our chief medical officer, the life expectancy is no greater than 12 months'.
Critical illness benefit option: Yes, claims under critical illness cover will be subject to a survival period of 28 days from the date of diagnosis (unless the definition requires a longer survival period). A claim will only be paid of the life assured satisfies the definition of the critical illness they are diagnosed with.
The complete list of conditions the policy covers are as follows:
• Alzheimer's disease/pre-senile dementia before age 65.
• Angioplasty
• HIV/AIDS, as a result of a blood transfusion
• Aorta graft surgery
• HIV in certain circumstances
• Bacterial meningitis
• Kidney failure
• Benign brain tumour
• Loss of limbs
• Blindness
• Loss of speech
• Cancer
• Major head trauma
• Coma
• Major organ transplant
• Coronary artery by-pass surgery
• Motor neurone disease
• Creutzfeldt-Jacob disease
• Multiple sclerosis
• Deafness
• Paralysis/paraplegia
• Heart attack
• Parkinson's disease before age 65
• Heart valve replacement or repair
• Stroke and structural surgery
• Third degree burns
• Total permanent disability before age 60.
Free cover during underwriting: Yes, free cover
is available. A free cover claim will be considered on death or diagnosis and on satisfaction of one of the range of critical illnesses, if selected, subject to conditions:
• Free cover is limited to the lowest of:
a) The life cover shown in the acceptance letter of free cover letter.
b) The amount of the loan.
• Free cover will apply from the later of:
a) The date of acceptance letter or free cover letter, if earlier.
b) The date of exchange of contracts/conclusion of missives/start of building work (for improvement/extension),
provided this date is within four months of the date of completing the application form.
• Free cover will apply from the earlier of:
a) A date 12 months after the date of completing the application form.
b) The date on which Scottish Amicable is advised that the policy is to start and premiums become payable, normally the completion date of the mortgage.
