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Royal & SunAlliance International


Protection Plus

Type: Cafeteria-style protection product including whole life and critical illness cover for overseas residents excluding the US.


Minimum sum assured/premium: £50,000/£67 a month, £670 a year.

Minimum-maximum ages: 18-75.

Allocation rates: 90-103 per cent.

Fund links: 80 funds from Baring, Collins Stewart, Fidelity, Gartmore, Investec, Merrill Lynch, Perpetual, Royal & SunAlliance International Financial Services, Principal, Templeton, Mercury, Schroder, Vanguard, Deutsche, Invesco, Thames River, GAM, Henderson, Dresdner, JF, HSBC, Lippo, Barclays, Aberdeen, Edinburgh, Neville James, Momentum and Brandeaux group.

Charges: None.

Options: Waiver of premium, key event options.


Minimum premium/cover: £67 a month, £670 a year/£50,000.

Maximum cover: Subject to negotiation.

Illnesses covered: Terminal illness, rheumatoid arthritis, Parkinson&#39s disease, motor neurone disease, loss of one limb, loss of speech, loss of hearing, heart valve surgery or replacement, blindness, benign brain tumour, aorta graft surgery, coma, Alzheimer&#39s disease, heart attack, coronary artery bypass surgery, cancer, stroke, renal failure, major organ transplant, permanent and total disability, paralysis/paraplegia, multiple sclerosis, major burns.

Minimum-maximum ages: 18-75.

Charges: None.

Options: Waiver of premium, key event options.

Commission: Initial 60 per cent, renewal 2.5 per cent after two years.

Tel: 01624 821212.

Company&#39s reputation 7.0

Premium rates 5.3

Range of illnesses 7.0

Flexibility 7.0

Charges 5.0

Commission 5.3

Product literature 7.6

Royal & SunAlliance has introduced protection plus, a cafeteria-style protection plan that offers whole life and critical illness cover (CIC).

Looking at the way that the plan fits into the market, Graham says: “This is particularly suitable for clients who do not wish to deal in sterling.”

Overy says: “As far as the UK is concerned, it appears that this product can only be made available to clients who are working abroad or offshore. It therefore has a very limited market for myself.”

Collins says: “This is an offshore product and is not available in the UK. There is a complicated list of countries where it is available, with various exclusions for some.”

Moving on to the type of client that the product is suitable for, Overy says: “This product is available for anyone who is not disqualified by residency and who has a need for protection and CIC.”

Collins thinks that it is targeted at expatriates, while Graham says: “This is for individual or corporate clients, although they must not be UK or US residents.”

Looking at the types of marketing opportunities that the plan provides, Collins says: “There are very few marketing opportunities for IFAs whose main business is in the UK. However there are some applications for those who operate offshore.”

Overy agrees. He says: “It offers very few opportunities. It is unlikely that I would use a protection plan as an investment vehicle, as there are many other products available on the market.”

Graham says: “The product is attractive for companies with non-UK based employees, especially on a key man basis.”

Casting an eye over the strong points of the plan, Overy says: “Again, there are very few useful features to this product. Most or all of the features available are also available from other providers within the UK.”

However Graham says: “The plan is flexible in premium payment and is flexible between the options of life cover and critical illness. It also has an excellent underwriting record.”

Collins says: “There is a good combination of critical illness and life cover, either separate or together, as main benefits. There is also the sensible addition of optional benefits. Finally there is a choice of currency.”

Turning to the drawbacks of the plan, Graham says: “The minimum premium seems high at £67 a month. Also the product is perhaps unimaginative in terms of the range of products covered.”

Collins says: “The biggest disadvantage is that the product is not available in the UK market. It also has a complicated availability booklet.” Overy thinks that the main drawbacks to the product are the cost and charges, as well as the residency restriction.”

Commenting on the range of illnesses that the product covers, Overy says that these are as good as many of the others on the market at the moment.

Collins says: “There are a reasonable range of illnesses covered by the plan. However there is no mention of HIV or Aids contracted through a blood transfusion or an operation. Although probably covered by the list, there is no mention of permanent disability.”

Graham says: “There is a standard range of illnesses covered. However I might have expected some more exotic illnesses for a plan in the offshore market.”

Looking at the flexibility of the plan, Graham thinks that this is good. Overy says: “The plan offers good flexibility, but is no more flexible than other good protection providers on the market.”

Collins adds: “The plan&#39s flexibility is good, if slightly restrictive.”

Moving on to the reputation of Royal & SunAlliance International, Overy thinks that this is good, while Collins says: “The company has a strong international reputation and is a major player overall.”

Graham says: “The reputation of Royal & SunAlliance International is as good as any in the market at the moment.”

Identifying the main competition for the plan, Graham thinks that the main competition will come from the Scottish Provident self-assured plan, while Overy points to products from Pegasus and Skandia.

Collins says: “There are several other companies offering offshore whole of life products, such as Canada Life, Scottish Amicable and Allied Dunbar.”

Focusing on the plan&#39s premiums, Graham says “These are minimal rather than high. There is no indication in the literature of the general level however.”

Collins says: “No detailed premium details were included in the literature. However I am very surprised that, since the company allows the payment of single premiums into the regular premium contracts, the company has not allowed for a standalone single premium contract.”

Moving on to the issue of if the charges are fair and reasonable, Overy says: “They are not reasonable and they appear to be high. But a 3 per cent bonus allocation does help.”

Graham says: “The 7 per cent bid/offer spread is high, and the establishment charges as a percentage of a fund could be high for large premiums.”

Collins says: “These charges seem to be high and come in many different forms. The set up charge is ambiguous, being based on a sum assured. They would not compete in the UK market.”

Looking at the product literature supplied with the plan, Graham says: “The literature is well set out and is in clear English.” Overy thinks that the literature is not bad.

Collins says: “The literature is reasonably clear and is well laid out. However there would appear to be a glaring contradiction between the territorial or residential guideline booklet and the main booklet on UK availability.”

Summing up, Overy says: “This plan appears to try to compete with many other whole of life plans, but then restricts residency. Perhaps Royal & SunAlliance should tell me why I should market this particular plan, as I cannot see any real advantages.”

Collins says: “This is a product to keep on file just in case it is needed by a client. I am surprised that Royal & SunAlliance has not made it available to UK residents.”

Finally Graham says: “Royal & SunAlliance International are often very good on underwriting. This factor could be important in selling this product in the market.”

Robert Graham, Associate partner, Scottish Financial Independence Group, Peter Overy, Overy & Booth IFAs, Christopher Collins, Partner, Kingstons Financial Management.


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