In response to a number of enquires on the subject, across a range of typical protection products we would expect the following outcome in the event of a claim:

Would we expect a policy to pay out?

Life Insurance YES

Income Protection YES

Mortgage Payment Protection Insurance YES

Critical Illness Cover NO

Private Medical Insurance NO

Source: www.lifesearch.co.uk

Life Insurance:

Full pay out as expected. There are no exclusions that we would expect to impact upon a claim.

Income Protection (IP):

Full pay out as expected when unable to earn as defined by the policy.

Mortgage Payment Protection Insurance (MPPI):

Full pay out as expected (as long as the client cannot work according to the policy’s definition of disability).

Critical Illness Cover (CIC):

As bird flu is not a listed condition we would not expect this type of policy to pay out unless the impact of the disease was such that the client could never work again on a ‘total and permanent’ basis.

Private Medical Insurance (PMI):

We are told by Phil Taylor, Managing Director of independent PMI specialist Preferred Medical that as soon as the condition, or a related condition, becomes acute it is likely that the patient would be admitted through A&E to an NHS facility where Intensive Care facilities would be available. There is virtually no provision of Intensive Care in the private sector.

Senior Technical Adviser, Kevin Carr, said ‘Income protection and life assurance policyholders should not be concerned regarding their protection insurance policies in relation to any potential outbreak of bird flu and it is worth noting that very few Critical Illness policies are sold without life cover. This example is a further endorsement of the UK public’s need for Income Protection as we are all more likely to lose our income through disability than we are to pass away.’

Kevin Carr, Senior Technical Adviser http://www.lifesearch.co.uk

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