Full roll-out introduces new option exclusive to rental income protection benefit customers
Legal & General (L&G) became the first major insurance provider to develop a protection product specifically for the private rental sector when it unveiled its rental protection plan (RPP) pilot in June.
After being tested through the Mortgage Advice Bureau (MAB) over the past four months, the selection of products - which includes rental income protection benefit, rental life insurance and rental life insurance with critical illness - is now exclusively available to all Legal & General intermediary partners.
The roll-out includes the addition of a new feature for rental income protection benefit customers, which gives policyholders who no longer rent a property as a result of taking out a mortgage the option to change their policy to an income protection benefit plan.
RPP is designed to pay out a monthly benefit, which could be used to help pay the rent, bills or other financial commitments in the event of a claim. All three products in the plan also include L&G's rehabilitation support available through its income protection offering and nurse support services, while tenants also have the opportunity in certain circumstances to increase the amount of cover if their rent increases without needing to answer any additional medical questions.
"The rental sector is growing, but unlike those who have taken their first step on the housing ladder, tenants won't have the natural trigger of a mortgage application to consider the protection that can be so vital should the worst happen," said Craig Brown, director, Legal & General Intermediary.
"At Legal & General, we know that rental payments are every bit as important as mortgage payments in a household's finances. We are proud to be the first provider in the market to launch a dedicated rental protection product exclusively to intermediaries following positive feedback on our pilot. UK rental prices are expected to increase by 15% over the next five years and nearly a quarter of UK households are expected to be in privately rented accommodation by 2023. These are couples, young professionals and families, thousands of whom are vulnerable to the financial implications of a critical illness diagnosis, long-term sickness or death of a loved one. It is therefore vital that financial services companies provide the solutions needed for this underserved market."
"As part of MAB's growth plans we are deliberately widening our addressable market," added Ben Thompson, deputy CEO of Mortgage Advice Bureau. "Being able to promote protection to tenants with Legal & General this year has helped us make meaningful inroads into our plans in this regard, specifically engaging with tenants who are aspiring to buy their first homes. Strategically this is important for us and Legal & General has been instrumental in helping us to enjoy success in this area. Most importantly, our partner AR firms that have embraced this have helped many tenants to be protected where previously they weren't."
Read our UnderCOVER review of RPP here.
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