The plan aims to provide the life assured with a regular benefit if they suffer illness or injury an...
The plan aims to provide the life assured with a regular benefit if they suffer illness or injury and are unable to work, leading to a loss of earnings. The benefit can replace lost earnings or, if the insured life is a houseperson, it can, for example, be used to cover additional expenditure.
Minimum acceptable monthly premium:
The minimum monthly contribution would depend on the age of the applicant.
For an individual aged 30, the minimum monthly contribution would amount to:
n £3.60 for day one cover
n £2.88 for four weeks deferred cover
n £2.42 for eight weeks deferred cover
n £2.25 for 13 weeks deferred cover
n £2.09 for 26 weeks deferred cover
n £1.89 for 52 weeks deferred cover
Minimum acceptable age attained at entry:
The minimum age attained at entry is 16.
Maximum age attained at entry:
The maximum age attained at entry is 59.
Maximum annual benefit available:
The maximum benefit is £120,000 a year, which is made up of 65% of income up to £60,000, plus 40% of any excess income above £60,000. In order to claim the maximum benefit of £120,000, a client's earnings would need to be £262,500.
Minimum policy term:
The minimum policy term is five years.
Termination ages:
A policyholder may choose any retirement age between 50 and 65 subject to a minimum term of five years.
Vary the retirement age after start date:
There is an option to increase the term. This would be subject to medical underwriting and have a minimum term of five years.
Vary benefit subject to underwriting:
Provided the policyholder does not exceed the maximum insurable benefit level, they may apply to increase their sum assured above the rate of inflation, subject to underwriting.
Guaranteed insurability options (GIOs):
There are no GIOs available.
Plan available without indexation:
Dependent on whether inflation proofing option is selected and subject to age band increases.
Benefit amount index linked:
If a policyholder selects the inflation proofing option at the outset, the benefit will be adjusted approximately by the average rise in the national average earnings index (NAEI) and the retail price index (RPI) up to a maximum of 10% and premiums will be adjusted accordingly. In the event of a claim, benefits will continue to rise approximately in line with inflation.
Where selected, indexation applies both pre-claim and during claim. Indexation is available throughout. Benefits increase approximately in line with the average rise in the NAEI and RPI. There is no limit to the increase in benefit pre-claim, or post-claim. The same average across the indices is used during claim, but this is limited to a maximum increase of 12% a year.
Rates increases take place on the anniversary date effectively resulting in the premiums for the index linked increases in benefit being calculated in line with the age of the member.
Waiver of premium available:
Waiver of premium is automatically included, although premiums must be paid for the first three months of a claim where shorter deferred periods (up to eight weeks) are chosen.
Premium increase with age:
The rates under the Pioneer contract can only be reviewed by a majority vote of eligible policyholders at a special meeting. They will, however, increase as the client gets older, in line with the published rate table.
Career break available:
A career break is available, with a maximum benefit of £10,200 a year. Provided the life assured returns to work within 52 weeks of the effective date of this alteration, then the policy will be re-instated to provide the benefit level immediately prior to the career break, without the need for further medical underwriting.
Long-term career break:
Provided that cover has been in-force for a continuous period of 36 months from the commencement date, a life assured may elect to suspend cover if they choose to take a career break. At the time this option is exercised, a date for the reinstatement of benefits must be specified by the policyholder. The time until reinstatement of the cover must be one of the following;
n Two years
n Four years
n Eight years
n 10 years
Houseperson cover:
If the life assured is a bona fide houseperson and not in gainful employment, a benefit of up to £10,200 a year can be paid. Evidence of income would not be required by Pioneer in the event of a claim, but it will require medical evidence.
If the life assured is a houseperson at the commencement of the incapacity, they must be totally incapacitated, due to illness or accidental injury, from carrying out normal household duties. Pioneer will assess the ability of the life assured to carry out the essential activities of their normal household duties. The life assured will be eligible to claim benefit provided they are totally unable to carry these duties out and provided they result in an increase in household costs.
Maximum housepersons benefit:
The maximum housepersons benefit is £10,200 a year.
Deferred period applicable to housepersons benefit:
The full range of deferred periods is available, including day one, one, four, eight, 13, 26 and 52-weeks deferred.
Rehabilitation benefit available:
Following a period of full claim benefits, if someone's illness or injury means that they can only work on a part-time basis or in a reduced capacity, consideration will be given to paying them a reduced benefit. While some people are able to work for a short period of time, others are not so fortunate, for example, following a stroke or multiple sclerosis.
Relapse benefit available: Yes
Linked claims:
If a policyholder returns to work after a claim and suffer again from the same condition within six months, benefit payments will resume immediately without a further deferred period, upon evidence of incapacity.
Maximum % of income insurable:
The benefit stated in the plan must not exceed 65% of gross salary (if employed), or 65% of net personal taxable income after deduction of business expenses (if self-employed). The maximum insurable benefit is £3,120 a month or £37,440 a year.
State benefits deducted from benefit amount:
State benefits will not be taken into account for the first 52 weeks of a claim, but thereafter the provider may reduce the client's benefit if over-insured. Continuing income deducted from benefit amount.
Other insurances deducted from benefit amount:
Other insurances are deducted if they arise from incapacity and involve a regular payment to the policyholder or a regular payment made on the policyholder's behalf.
Pension income deducted from the benefit amount:
Pension income will be deducted, unless the payments were received while working, in which case it would not be taken into account for the purpose of calculating maximum insurable benefit.
Standard definition of disability:
An 'own occupation' definition is offered throughout.
Two deferred periods in one plan:
Split deferred period contracts are available with a maximum of two deferred periods per policyholder.
Number of occupation classes:
Pioneer uses one rate for all occupations.
Number of exclusions applying to the plan:
There are three exclusions, namely acts of war, normal pregnancy and infection with HIV or Aids.
