The criteria The panel of judges for the critical illness COVERmarks met in mid-January to fine tune...
The criteria
The panel of judges for the critical illness COVERmarks met in mid-January to fine tune the criteria for assessing each contract and carry out the final judging process.
The judges were Catherine Tennant, editor of COVER; Julie Hopkins, chief underwriter at Hannover Life Re; Tony Worthington, distribution and development manager at Swiss Re Life & Health; Phil Cleverley, UK underwriting manager at ERC Frankona; Dale Tranter, protection researcher at Countrywide Independent Financial Advisers; Nick Telfer, head of research at the The Research Department; and Brian Lentz, IFA from Portfolio Insurance Consultants.
The judging criteria were finalised as follows:
The COVERmarks are based on five levels of assessment, each depicted by a shield. They assess each contract in terms of breadth and quality of cover, but not on price. Each level is independent of the next, so a contract achieving, say, levels one, three and five but not two or four, would still be awarded three shields.
Shield one: This will be awarded to those contracts which offer comprehensive cover, that is those which cover the 20 conditions as defined by the IFAA/ABI. This will be awarded regardless of whether the model wordings have yet been adopted, since they are not compulsory until June 2000.
The 20 conditions include the core seven - heart attack, cancer, stroke, coronary artery bypass surgery, kidney failure, major organ transplant and multiple sclerosis - plus aorta graft surgery, benign brain tumour, blindness, burns, coma, deafness, heart valve repair/replacement, loss of limbs, loss of speech, motor neurone disease, paralysis/paraplegia, Parkinson's and terminal illness.
Shield two: This will be awarded to those companies that have already adopted the model wordings as a minimum standard, where they offer cover for that condition. Those plans which offer cover over and above the ABI model wordings must comply with sections 1.24 and 1.25 of the ABI's Code of Practice (see appendix 1).
Shield three: This will be awarded to those contracts that offer an 'own occupation' basis for permanent total disability.
Shield four: This will be awarded to those contracts which demonstrate flexibility. Each contract will be scored for its flexible elements by using The Research Department's DNA system. These elements will include the choice between guaranteed or reviewable premiums, the option to increase or decrease the term (term plans) and the sum assured, guaranteed insurability options, premium holidays and the option to take the critical illness benefit as income (see appendix 2).
Shield five: This will be awarded to those contracts which, in the eyes the judges, demonstrate innovation. This could be in the plan structure, cover levels or underwriting.
l Please note, the criteria have been amended slightly from those published in November 1999, to ensure they are water-tight and truly objective.
The definitions
Core conditions
Cancer:
A malignant tumour characterised by the uncontrolled growth and spread of malignant cells and invasion of tissue. The term 'cancer' includes leukaemia and Hodgkin's disease, but the following are excluded:
l All tumours that are histologically described as pre-malignant, as non-invasive or as cancer in situ.
l All forms of lymphoma in the presence of any human immunodeficiency virus.
l Kaposi's sarcoma in the presence of any human immunodeficiency virus.
l Any skin cancer other than malignant melanoma.
Coronary by-pass surgery:
The undergoing of open heart surgery on the advice of a consultant cardiologist to correct narrowing or blockage of one or more coronary arteries with by-pass grafts - but excluding balloon angioplasty, laser relief or any other procedures.
Heart attack:
The death of a portion of the heart muscle as a result of inadequate blood supply as evidenced by an episode of typical chest pain, new electrocardiograph changes and by the elevation of cardiac enzymes. The evidence must be consistent with the diagnosis of a heart attack.
Kidney failure:
End-stage renal failure presenting as chronic irreversible failure of both kidneys to function, as a result of which neither renal dialysis or renal treatment is initiated.
Major organ transplant:
The actual undergoing as a recipient of, or inclusion on an official waiting list for, a transplant of the heart, liver, lung, pancreas or bone marrow.
Multiple sclerosis:
A definite diagnosis by a consultant neurologist of multiple sclerosis that satisfies all the following criteria:
l There must be current impairment of motor or sensory function that must have persisted for a continuous period of at least six months.
l The diagnosis must be confirmed by diagnostic techniques current at the time of claim.
Stroke:
A cerebrovascular incident resulting in permanent neurological damage. Transient ischaemic attacks are specifically excluded.
Additional conditions
(words in brackets means the choice is at the discretion of the company)
Aorta graft surgery:
Undergoing surgery for disease of the aorta needing excision and surgical replacement of a portion of the diseased aorta with a graft. For this definition, 'aorta' means the thoracic and abdominal aorta but not its branches.
Benign brain tumour:
A non-malignant tumour in the brain resulting in permanent deficit to the neurological system. Tumours or lesions in the pituitary gland are not covered.
Blindness:
Total, permanent and irreversible loss of sight in both eyes.
Coma:
A state of unconsciousness with no reaction to external stimuli or internal needs, persisting continuously with the use of life support systems for a period of at least 96 hours and resulting in permanent neurological deficit. Coma secondary to alcohol or drug misuse is not covered.
Deafness:
Total permanent and irreversible loss of all hearing in both ears.
Heart valve replacement or repair:
Undergoing open-heart surgery from medical necessity to replace or repair one or more heart valves.
Loss of limbs:
The permanent physical severance of two or more limbs from above the (elbow/wrist) or (knee/ankle) joint.
Loss of speech:
Total permanent and irreversible loss of the ability to speak as a result of physical injury or disease.
Motor neurone disease (before age X):
Confirmation by a consultant neurologist of a definite diagnosis of motor neurone disease (before age X).
Paralysis/paraplegia:
Total irreversible loss of muscle function or sensation to the whole of any two limbs as a result of injury or disease. The disability must be permanent and supported by appropriate neurological evidence.
Parkinson's disease:
Confirmation by a consultant neurologist of a definite diagnosis of Parkinson's disease (before age x). Parkinson's disease secondary to alcohol or drug misuse is not covered.
Terminal illness:
Advanced or rapidly progressing incurable illness where, in the opinion of an attending consultant and a chief medical officer, the life expectancy is no greater than 12 months. AIDS is specifically excluded and not covered under this definition.
Third degree burns:
Third degree burns covering at least 20% of the body surface area.
Model exclusions
Aviation:
Taking part in any flying activity other than as a passenger in a commercially licensed aircraft.
Criminal acts:
Taking part in a criminal act.
Drug abuse:
Alcohol or solvent abuse, or the taking of drugs except under the direction of a registered medical practitioner.
Failure to follow medical advice:
Unreasonable failure to seek or follow medical advice.
Hazardous sports and pastimes:
Taking part in (or practising for) boxing, caving, climbing, horse racing, jet skiing, martial arts, mountaineering, off-piste skiing, pot-holing, power boat racing, underwater diving, yacht-racing or any race, trial or timed motor sport.
HIV/AIDS:
Infection with human immunodeficiency virus (HIV) or conditions due to any acquired immune deficiency syndrome.
Living abroad:
Living outside the EU for more than 13 consecutive weeks in any 12 month period.
Self-inflicted injury:
Intentional self-inflicted injury.
War and civil commotion:
War, invasion, hostilities (whether war is declared or not), civil war, rebellion, revolution or taking part in a riot.
