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Coronavirus update for protection advisers

15 May 2020

coronavirus

We are here to help you

We know this is a difficult and unsettling time for everyone and we are closely monitoring the impact of the Coronavirus 2019-nCOV outbreak. We’ve created some online support and answers to frequently asked questions which may help.


Protection

We will constantly review and update these questions and answers and will do everything we can to help advisers and their customers buy much needed cover. We have moved our teams to remote working, and we are very much ‘open for business’. Unfortunately, more limited access to medical information means that there will be some delays; we may not be able to offer as much cover as we normally could, and in some cases, we may have to postpone cover.

Have you changed your application questions?

As a result of COVID-19 we initially amended our health and travel questions for the Interactive submission route.

These include:

  • changes to our current symptoms questions to more explicitly capture symptoms that are associated with COVID-19 (fever and high temperature)
  • an update to our future travel question to highlight anyone who intends to travel, against the Foreign and Commonwealth Office (FCO) guidance.

If someone discloses that they have, or have had, Covid-19, we will be postponing offering terms, typically for 1 month after recovery for Life cover and 3 months for Critical Illness or Income Protection.

If someone says that they are intending to travel against FCO guidance, we will not offer any terms until they have returned to the UK.

We have now introduced a Coronavirus (COVID-19) specific question:

Have you tested positive or been in contact with someone who has Coronavirus (COVID-19), have you had a fever or high temperature, a new continuous cough, breathing difficulties or any other symptoms of Coronavirus (COVID-19) or been advised to self-isolate for any other reason?

Tested Positive for COVID-19

In the event that someone has tested positive for COVID-19, an initial postponement period will apply.

After a full recovery had been made and they have returned to their normal activities, the following terms will be offered;

Life cover - standard rates 1 month after they have returned to their normal activities.

Critical illness - standard rates 3 months after they have returned to their normal activities.

Income Protection - standard rates 3 months after they have returned to their normal activities.

Come into contact with someone with COVID-19

In the event that someone has come into contact with someone who has tested positive for COVID-19, the following apply;

if they have been advised to self-isolate, then an initial postpone period will apply.

After a full recovery had been made and they have returned to their normal activities, the following terms will be offered;

Life cover- standard rates 1 month after they have returned to their normal activities.

Critical illness - standard rates 1 month after they have returned to their normal activities.

Income Protection - standard rates 1 month after they have returned to their normal activities.

NB – if someone has come in to contact with someone with COVID-19 and not been advised to self-isolate then standard terms can be offered for all benefits. Our underwriters will automatically disregard contact in the course of the normal occupation, e.g. health worker, where there are no symptoms or no instruction to self-isolate.

In addition, we have made a small change to our “Symptoms of ill Health” question to identify fever or high temperature suffered in the last 3 months.

What is the position if your client is self-Isolating?

If you are self-isolating due to symptoms that you are experiencing, then this will need to be disclosed on the application form. If the application has been completed but you are still being underwritten or if you have been accepted but the policy has not yet commenced, then you must inform Zurich under the duty to take reasonable carer elating to any change in health prior to the policy starting. 

In these circumstances, where you have been advised to self-isolate due to experiencing symptoms yourself, your application will be postponed. typically for 1 month after a full recovery for Life cover, or for 3 months after a full recovery for Critical Illness.

If you are applying for Life cover with or without Critical Illness cover and are self-isolating due to someone else in your household experiencing symptoms, your application will be postponed for 1 month after your self-isolation has been completed.

If you are applying for an Income Protection Plan or have requested either Waiver of Premium or Total & Permanent Disability benefits on your plan you will need to answer the question regarding being off work or working reduced hours and provide full details if you are self-isolating. This will include providing full details as to whether the self-isolation is due to symptoms suffered by others or because of contact with someone with the virus. If you are unable to work as a result of the self-isolation, the application for these benefits will be postponed. Where you have been advised to self-isolate due to experiencing symptoms yourself, any application for Income Protection, Waiver of Premium or Total & Permanent Disability benefits will be postponed for 3 months from after you have made a full recovery. If you are self-isolating due to someone else in your household experiencing symptoms, your application will be postponed for 1 month after your self-isolation has been completed.

If you are staying at home due to being advised that you fall into the category of requiring “shielding” and you have no other reason to self-isolate and are not experiencing any symptoms of Coronavirus (Covid-19) then we will continue to assess your application based on your current health.

Will you pay out for Critical Illness if my client gets coronavirus?

Coronavirus is not a specified ‘Critical Illness’ on Zurich’s policy. The good news is that the vast majority of people who contract the illness go on to make a full recovery. In some cases, people will die as a result, and in such circumstances, the life insurance attached to our plans would pay out.

Under our “Respiratory Failure – Of Specified Severity” definition, it is possible a claim might be presented but the opinion of our Claims and Medical Officer is that coronavirus is unlikely to produce the permanent symptoms or impairment to lung function required to meet this definition.

We will consider any such claims presented on the basis of the individual circumstances. 

If a customer bought one of our Critical Illness Select policies then under the “Intensive Care – 10 days continuous duration” if their Coronavirus required ventilation and intensive care, then a claim could be presented and considered.

Will you pay out on a Life Insurance Policy if my client dies of coronavirus?

Yes, following our normal claims process and assessment.

Will you pay out on an Income Protection Plan if my client is off work as a result of corona virus/complications?

Following our normal claims process and assessment, if the definition of disability is satisfied due to the coronavirus, any complications of coronavirus or its impact on any underlying or existing conditions them an income protection claim would be payable after the end of the deferred period.

Is my client covered regardless of how/where it was caught?

No, we would have to understand and consider the full individual circumstances surrounding any claim.

Is my client’s child covered for this under the children’s benefit under Critical Illness as a secondary condition as they have underlying respiratory issues?

Under our “Respiratory Failure – Of Specified Severity” definition, it is possible a claim might be presented based on coronavirus alone but the opinion of our Claims and Medical Officer is that the coronavirus is unlikely to produce the permanent symptoms or impairment to lung function required to meet this definition.

In the circumstances where there is already an underlying serious respiratory condition the coronavirus might have a contributory impact but again potentially only for a temporary period.

We will consider any such claims presented on the basis of the individual circumstances.

If a customer bought one of our Critical Illness Select and the enhanced children’s cover, then under the “Intensive Care – 10 days continuous duration” if their Coronavirus required ventilation and intensive care, then a claim could be presented and considered.

Any other key process issues we should be aware of? For example, if my client requires a GP report, will there be delays due to the pressure currently on GP surgeries?

Given the current demands being made on GP’s and to allow them to concentrate on maximising patient outcomes, Zurich has taken the decision to suspend its GP Report chase activity. We will be making an initial call to ensure it has been received and that the surgery are in a position to complete the report and any requirements, such as pre-payment, they may have.

At the current time we continue to receive completed GP reports back.

Unfortunately, we have been informed by the third parties who conduct our medical examinations and nurse screenings that they are suspending their traditional services. They have launched a remote examination and blood results service, we will be using it where it is appropriate to do so.

For all new applications where our normal underwriting philosophy would have been to obtain a medical examination or a nurse screening, we shall issue a GP report in its place and then advise further upon receipt of the completed report as to whether we can offer the full cover applied for or if we need to reduce cover in order to proceed.

What are we going to do for clients who can’t pay their premiums?

We have introduced a series of measures to try and help customers who are experiencing financial difficulty.

For most products and regardless of which administration platform your customer’ policy is on, they will be offered the option to defer premiums for a period of three months.

The ability to defer premiums will provide support to customers who need it the most. We want to ensure customers keep their cover, but we know once a customer has built up arrears, it may be difficult to bring finances back on track, so it is important to keep this in mind when you are discussing these options with your customers.

For those customers on our Life Protection Platform there is an additional option to reduce the sum assured and then increase it back to the original level without the need for underwriting.

For customers who hold an income protection policy (on our Life Protection Platform) we are waiving the requirement for it to be in force for a minimum period of twelve months before the career break option can be utilised.

To understand more about these options, visit our dedicated page. If you would like to discuss a customer’s options further, please call our Customer Options Team on 0370 241 6945.

How are you currently dealing with applications from doctors and nurses?

We are treating medical professionals the same as any other customer.

Have you altered you risk appetite or underwriting approach since coronavirus?

As a result of Coronavirus and the impact that is has on older lives and specifically those with health issues, we have reduced our risk appetite for non-standard lives over age 60. We have also amended our point of sale rules to reflect our reduced risk appetite for lives over age 70 at point of sale.


New customers:

Will you offer a new income policy to someone who is currently furloughed?

Yes.

If yes, would they declare their normal pre-furloughed salary/income or their furloughed salary?

Pre-furloughed salary.


Existing customers

If a customer who is currently furloughed subsequently becomes ill, their employer has the choice whether to continue furloughing them or to remove their furlough status and put the employee on sick leave. Please could you confirm if the customer could still claim on their income protection policy if their employer chooses to:

Put them on sick leave, e.g. SSP?

Yes, given they are still gainfully employed

Continue them on the furlough scheme?

Yes, although ongoing income would be taken in to account.

Using an example of a customer who is insured for £4,000pm but who is receiving £2,500pm on furlough, if they become ill and unable to work how much would their policy pay out?

We would base our benefit calculation on their full salary pre furlough.

For a self-employed customer, who technically is not currently working (due to lockdown/lack of trade), could they still claim on their IP policy if they were sick? Since they are not actively working, would a claim still be assessed on ‘Own Occupation’?

Yes, we would take the view that they haven’t ceased working out of choice and as such we would assess their claim on the pre furlough occupation and income.

Do the same self-employed customers run the risk of a reduced pay out, since their current earnings will be lower due to lack of trade? Our question here has two issues. First the current situation and second - say next year when we are back normal but the earnings this year will have been reduced.

If this was evidenced, we would take an average we typically see this with self-employed, who may have fluctuating income.

If a customer’s employer enforces a COVID-19 related pay cut, how will this impact their benefit level:

For a customer who isn’t yet claiming?

We would take a reasonable approach and average income.

For a customer who is already claiming?

There would be no impact on those already in claim.

If a customer’s employer makes them redundant due to the COVID-19 situation, will this impact their benefit level and/or ability to claim:

For a customer who isn’t yet claiming?

Would not be considered actively employed, and so generally they would not be able to claim, we would consider the individual circumstances.

For a customer who is already claiming?

No impact on the current claim.

How do you see your products are affected by the FCA’s challenge on product value?

We are very happy that our Life term, critical illness and income protection policies provide significant value for customers, arguably more now than ever. Within our policies we have optional benefits such as ‘fracture cover’ – this pays out a set amount (up to £6,000) for a fractured bone. In the current climate there are fewer sports being played, but people are turning to different types of exercise – such as cycling, walking or running. We are all also at risk of day to day slips and trips which result in fractured bones and damaged ligaments, and so we are very comfortable that the policies and their features continue to offer product value. Many of the features on our plans can be switched on or off by customers, which enables them to further tailor cover to suit their personal circumstances in these challenging times.


Zurich Corporate Risk

Further information and more detailed FAQs can be found here.


Business Continuity

Is the business submission process at the moment business as usual, or are there any changes in what an adviser applying needs to do?

The submission process continues unchanged at the current time but remains under review and any changes will be communicated.

We would remind you of the delegated underwriting functionality within our platform, that allows advisers to pass the online application over to the client remotely, to complete the medical questions and then to return to the adviser, to complete submission.

Are there any changes to SLA’s?

We are not changing any of our current service levels. However, we are anticipating a decrease in activity due to staff absence and effectiveness (in working in a different way under BC) and therefore anticipate an impact on our performance against the usual service level agreement measures.

If a wet signature is required to date applications (or similar), what can be done if advisers can’t see clients face to face for this?

For most of our business processing, we don’t require wet signatures. Our new business applications are signature free, we already use ‘DocuSign’ for AMRAs’. Our trusts (with the exception of the Relevant Life Trust) are on-line and signature free.

If a wet signature would be required as part of a normal process, we will aim to accept an e-mail from the client/adviser confirming the change, wherever possible. There may be circumstances where the wet signature is still required for legal purposes, such as for amendments to trust documents.

We have asked whether it is possible to proceed with a relevant life trust or business trust where the settlor’s signature has not been witnessed. We have sought legal advice, and this has identified:

  • Trusts can be established by either a “Letter of Request” or by a Deed.
  • Witnesses are required for a document to be executed as a deed by providing the independent verification of the signature.
  • Executing as a Deed provides evidential certainty as to the authenticity of signatory to Courts and other third parties.
  • It is always preferable for trust forms to be completed as deeds.
  • The key risk in proceeding as a Letter of Request (non-witnessed signature) is that someone could potentially challenge whether the person establishing a trust actually signed the trust form and therefore question whether the trust was validly established.

The risk therefore in choosing to proceed without a witness signature is that of the person establishing the trust and as such we advise that they seek their own legal opinion. Where we receive instruction to proceed on that basis, we will outline the risks as we have established them.