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‘Competition adds to confusion on CI’

Bright Grey has warned against protection providers racing each other to cover the most conditions under their critical-illness policies.

Bright Grey and LV= both upgraded their cover and added more conditions last week in light of the Association of British Insurers’ new CI definitions.

The ABI’s statement of best practice for CI must be implemented by all protection providers by the end of April and many are taking the opportunity to revamp their products at the same time.

Bright Grey products director Roger Edwards says: “There have been illness races in the past, with one provider adding an illness, then others trying to trump them. This makes it difficult for advisers to draw comparisons and has even added to the confusion about critical-illness cover.”

However, Bright Grey is adding four conditions to its cover including open-heart surgery and severe lung disease. LV= is adding five conditions including aplastic anaemia, liver failure and severe lung disease. It is also reducing premium rates across some terms and ages by an average of 3.8 per cent.

Legal & General recently added three conditions including encephalitis while extending the definitions on three illnesses including heart attack.

Edwards says: “This means our critical-illness cover now covers 33 illnesses including total and permanent disability. However, we firmly believe that the focus should not be on the number of conditions a critical-illness product covers.”

LV= director intermediary business Stuart Tragheim says: “Intermediaries rightly expect us not only to be competitive on price but to offer their clients a level and range of cover relevant to the range of risks they want to guard against.”

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