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Pru raises CI premiums by average 22%

Prudential is the latest in a growing list of product providers to increase critical-illness cover premiums.

The Pru&#39s rates on its only CI product, Prudential protection, a mortgage term-linked policy, will increase by an average of 22 per cent from this week.

The company says it is maintaining rates on a guaranteed basis for the length of their term, which goes against the trend of many of its rivals.

Last week, Scottish Provident increased premiums on its combined life and CI policies by an average of 10 per cent.

This was the second ScotProv increase in less than two months following an average increase in premiums of 25 per cent last December.

Norwich Union admitted recently that its 40 per cent average increase in premiums had cost it business, prompting it to cut its combined term and CI premiums by 19 per cent and its mortgage term and CI by 13 per cent.

Prudential spokesman Darragh Leeson says: “We have always maintained the product on a guaranteed basis and intend to continue doing so. Obviously, we are aware that this depends on adequate guarantees being made available from reinsurers.”

John Joseph Financial Services managing director John Joseph says: “For the Pru, this is quite a low increase. It has an old book and most providers with old books are facing a greater numbers of claims.”


Scottish Provident CI premiums

Money Marketing would like to point out that the maximum Scottish Provident has increased its critical-illness premiums is an average of 14 per cent on policies with a 25-year guarantee. Policies with a 15-year guarantee are seeing an average rise of 12 per cent, not 25 per cent, as reported last week.

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