Burgesses’ SecurityFirst
HEALTH CARE INSURANCE REPORT - 1ST SEPTEMBER 2003
SecurityFirst is a mortgage payment protection insurance policy, underwritten at Lloyd’s and administered by Paymentshield, that complies with the CML/ABI baseline standard for such plans. It has been relaunched and now offers three months free cover to all applicants. New mortgage holders get free unemployment and disability cover while existing mortgagors get free disability cover only.
Thirty or 60 day deferred periods are available and benefit is payable for up to 12 months. Clients must be aged 18 to 64, be in work, permanently resident in the UK and have a mortgage. Maximum benefit is the lower of £1,500 or 65% of income. A three month exclusion period applies to the unemployment benefit from the end of the free cover period. This is waived where a client is switching from an existing mortgage payment protection insurance policy.
Disability exclusions include pre-existing conditions which were evident in the 12 months prior to starting the policy, stress, pregnancy, medically unnecessary treatments and most non-consultant certified back-related conditions.
Buying online gives client an additional 10% premium cut, even where a broker is involved. Brokers can now bolt-on SecurityFirst’s website to their own, so a client can access the broker’s website, read about the policy, determine what cover they need, then apply online direct to Paymentshield. Commission is 25% each year payable on an indemnity basis.
Comment: The revised plan undercuts major lenders, pays attractive commission and can be included within the broker’s own website. That should encourage more brokers to look at mortgage payment protection insurance and to set up a website, especially as clients pay 10% less.
Rating (max 5): Innovation: 3. Value for money: 3. Overall 3.
