Scottish Equitable Protect's sales of critical-illness policies have dropped significantly since it withdrew from the guaranteed rate market.
In 2002, critical cover accounted for around 50 per cent of the total protection book and in 2003 this dropped to around 30 per cent. The company says this reflects a variety of factors.
It says some providers have kept guaranteed rates but at the cost of conditions covered such as angioplasty. It still offers angioplasty as a condition and says in future there will be a trade-off between guaranteed rates with fewer conditions and reviewable rates with a “full complement”.
Spokeswoman Lesley McPherson says the guaranteed market is resilient and is likely to be sustained at least until the end of the year. But she says the price differential between guaranteed and reviewable rates is growing.