The human form of mad cow disease is being included under Scottish Provident's critical-illness contract because of clients' fears.
Although ScotProv covers the disease under irreversible organic degenerative disorders, it has changed the wording of its policy.
Experts are still unclear about the link between bovine spongiform encephalitis and its human variant Creutzfeldt Jacob Disease.
Product marketing manager Roger Edwards says: "Because CJD has been so high-profile, we often get people asking us to confirm the cover. We are committed to making things as clear as possible."
The new wording will be included for ScotProv's full range of critical-illness products, including life and term insurance.
Since 1995, there have been 23 known or suspected UK cases of CJD linked to eating contaminated beef. More than 170,734 UK cattle are reported to have contracted BSE.