View more on these topics

A Vital plan from Pru



Type: Menu-style protection plan comprising core critical illness cover and level, decreasing or index-linked life cover, optional disability cover, unemployment cover and income protection with premiums reduced by Vitality health programme


Minimum premium/cover: £25 a month/£10,000

Maximum cover: £500,000

Conditions covered: Primary serious illness cover – 9 cancer-related conditions, 13 heart and artery conditions, 23 stroke and nervous system conditions, 6 gastrointestinal conditions, seven connective tissue disease conditions, 7 urogenital tract and kidney conditions, 7 respiratory disease conditions to age 70 accidental HIV benefit, 8 musculoskeletal trauma conditions, four eye conditions to age 70, two ear conditions to age 70, major organ transplant 5 conditions of permanent disability; additional conditions with comprehensive serious illness cover – Two cancer-related conditions, 16 heart and artery conditions, seven stroke and nervous system conditions, one gastrointestinal condition

Minimum-maximum ages: 16-75

Minimum term: Five years

Options: Full serious-illness cover for children, disability cover, income protection, unemployment cover, waiver of premium, whole of life cover, minimum protected account option to reinstate set level of cover after a claim


Minimum sum assured/minimum premium: £10,000/£25 a month

Minimum-maximum term: Five years

Minimum-maximum ages: 16-75

Options: Disability cover, whole of life cover, income protection, waiver of premium

Commission: standard terms – 150% of Lautro with a 10% enhancement for all online submissions

Tel: 0845 279 3000

Prudential’s PruProtect is a menu-based protection plan comprising core critical illness cover and level, decreasing or index-linked life cover, with optional disability cover, unemployment cover and income protection with premiums reduced by Vitality health programme. Vitaility rewards policyholders for living a healthy lifestyle by awarding points for activities such as a health screen or fitness plans. Everyone starts at the bronze level and can move up through silver, gold and platinum bands, which will reduce the following year’s premiums.

Introducing the product, Highclere Financial Services partner Alan Lakey explains that Prudential has relaunched the flexible protection plan on the back of its innovative vitality points concept.

He says the plan can encompass life cover, critical-illness cover, income protection and redundancy cover and says the product has been repriced to make it extremely competitive.

Lakey points out that Prudential is using a concept proven in South African by its partner company, Discovery. “The concept is simple, yet brilliant. The fitness concept offering discounts to health clubs as well as reducing premiums will appeal to the very sector they are aiming at – health conscious individuals. Those planholders seeing regular premium increases are likely to devote attention to their lifestyle and health as a consequence. Prudential is likely to enjoy positive selection whereby their client bank contains a higher percentage of healthy policyholders,” he says.

Applicants can also choose to guarantee their cover up to 300 per cent of the original sum assured. If they receive a 100 per cent payout due to a stroke the policy will rebase to the original sum assured which can then pay out again for some other critical condition. Prudential also aims to provide acceptance terms within seven days for 80 per cent of applicants.

According to Lakey, Prudential beats the opposition on two counts. “Firstly, the critical illness concept is taken a stage further by enabling lesser conditions, which are nonetheless serious, to be covered. These range from angioplasty to pacemaker insertion and in total there are 153 different conditions covered. The plan does not necessarily pay out 100 per cent of the sum assured as lesser conditions result in a percentage payment such as 25 per cent or 50 per cent.

“Secondly, all planholders start on a bronze standard. If they achieve sufficient points by dint of healthy lifestyle or commitment to fitness they enjoy reduced premiums. Bronze planholders will suffer gradual premium increases,” says Lakey.

Discussing the potential drawbacks of the plan Lakey says: “Technically it is an excellent plan but it is sufficiently complex to confuse some potential planholders. This is likely to mean that it fails to challenge L&G and Norwich Union for serious market share.”

Lakey adds that policyholders are provided with details of how to accumulate sufficient points to reach silver, gold or platinum status. “This involves a commitment in time and effort which many consumers will be unable or unwilling to give. The reviewable premium version does not provide the usual 5 year guaranteed period which would allow some prospect of premium continuity.’ he says.

Scanning the market for likely competitors Lakey says: “Prudential’s plan is unique although it is being marketed within the traditional menu plan format. Competition is likely to come from Scottish Provident and LV= on the menu front with Skandia, Bupa and Royal Liver providing opposition for individual plans.”


Suitability To Market: Good

Competitiveness of premiums: Good

Flexibility: Good

Adviser Remuneration: Good

Overall 9/10


CML collates sub-prime data

The mortgage industry is moving closer to fully understanding the profile of the UK sub-prime sector, with the Council of Mortgage Lenders set to produce in-depth analysis by the year end.The trade body has established seven standard definitions of the sub-prime market and wrote to all its members this week asking them to provide details […]

Capita signs £270m deal with CIS

Capita has been assigned to deliver business processing services to Co-operative Insurance, part of Co-operative Financial Services today in a 10 year deal worth over £270m. Capita will provide customer services, policy administration, new business, claims activities and the associated technology for around 4.5m policies across CIS’s life and pensions and unit trust operations. Capita […]

PBR: Darling to incentivise lenders to promote fixed-rate mortgages

Chancellor Alistair Darling has announced the Government will incentivise mortgage lenders to increase the take up of fixed-rate loans and encourage them to increase terms from two years to 10 years or more.He said: “Fixed-rate mortgages can offer more certainty and I want to see more fixed-rate mortgages not just for two years but ten […]

Little movement in lending for August

The Council of Mortgage Lenders says total gross lending was broadly flat month on month in August at £34bn compared with £34.1bn in July. However, lending for house purchase is down by 11 per cent compared with last August.

Pensions - thumbnail

Auto-enrolment — don’t leave it too late…

With auto-enrolment (AE) well under way for the UK’s largest businesses, over the next three years an additional 800,000 smaller employers (with less than 60 employees) will start their journey to comply with the legislation. AE mandates all eligible employees and their respective employers to make regular pension contributions into a qualifying pension scheme. To learn more about the legislation read our brief Jelf AEase — simple steps to AE compliance guide.


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm