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Critical barrage for Big V plan

Advisers have criticised Virgin Money’s cancer-only protection product, The Big V, for being more expensive and having less coverage than many critical-illness policies.

There are concerns that clients could switch out of CI cover or life policies and be worse off. The product is administered by Scottish Widows and features three stages of cancer cover – early, intermediate and advanced – and will be sold directly online and by phone. It pays out 10, 25 or 100 per cent of sum assured respectively.

Widows protection marketing manager Nick Kirwan says: “This is not a critical-illness policy. This is a simple, straightforward product that will appeal to younger people who might not have any protection.”

One industry underwriter, after looking at Virgin’s stage three cancer definition, estimates a 30 per cent survival rate of more than 12 months from diagnosis, so 70 per cent of claimants would have qualified for full payment from life cover.

Premiums on 100,000 of life and CI cover, 25 per cent CI, comparable with Virgin’s stage two payout, and 75 per cent life, comparable with its stage three payout terms, came in as low as 17.39 a month with Scottish Equitable, compared with Virgin’s 23.06 a month.

CBK Colchester principal Peter Chadborn says: “When you pull this product apart, there are many flaws. Depending on how it is mark- eted, there is a risk that con- sumers will buy this thinking they are buying CI.”

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