1 Comment 1 CommentThis is great for clients and advisers:
Think of benefits like Special Events Increase Benefits and Future (Guaranteed) Insurability Options. Both are hugely valuable, especially for people needing more cover but whose health has deteriorated since initial underwriting.
However, there are time limits within which these increases can be made, requiring action and usually within a relatively short time, or the opportunity is lost.
Unfortunately, there is no consistency of time limits among insurers and, even within insurers, there might be no consistency of time limit for the same benefits across different products.
By way of example, consider Special Events Increase Benefits (also called Life Events Benefits, Specified Life Events Increase and so on) under trauma covers.
Special Events Increase Benefits typically allow clients to increase existing trauma cover (subject to certain limits and restrictions – a topic for exploration all on its own!) when the life insured experiences a defined ‘special event’(for example, marriage, birth of a child or buying a house) without the need for general medical assessment by the insurer concerned.
For trauma covers, time limits range from:
The longer and more generous the time limit is, the better. The timing of some ‘special events’ is impossible to predict; they could happen at any time or not at all. This makes many special events impossible to ‘diarize’, so more time to ‘discover’ the event and take required action is valuable.
Of course, continually reminding your client of the advantages of Special Events Increase type benefits and the need to contact you as soon as they become aware of a special event occurring is a good idea, but realistically, how many clients would remember, especially if great excitement accompanies the event.
If the time window to exercise a benefit is linked also to policy renewal, this creates a ‘reminder’ opportunity for advisers to contact their clients and ask the necessary questions, even if regular scheduled reviews are some way off. This will allow action to be taken within the set time limits.
Should insurers advise clients of the benefits like Special Events Increase and the time limits involved, in their renewal notices? That would be useful, particularly for those insurers that link a time limit to policy renewal, but I’ve just received a policy renewal notice of my own and there is no such mention.
| « Fidelity building register to help firms connect with Career connect graduates | FANZ to up the ante against NZ’s soaring medical inflation » |
Special Offers
Sign In to add your comment
© Copyright 1997-2026 Tarawera Publishing Ltd. All Rights Reserved
Cover was deferred due to ongoing headaches of unknown origin, and so we turned to plan B: increase her trauma cover under the special events increase benefit (new mortgage lending). $50k became $87.5k, and there was only one thing left to do – increase the excess on her Southern Cross medical cover to help offset the increased premium for her trauma cover.
I spent the next couple of months trying to contact the client, with my calls, emails and texts going unanswered. I sent one final email letting her know that I was closing off the engagement and to get in touch if she still wanted to increase her excess.
She called almost immediately, and I could tell straight away that something wasn’t right. Her speech was slurred, and she was having trouble finishing her sentences. Turns out she had suffered a stroke shortly after the increase went in force and had been off work ever since. I’m picking the stroke may have been related to the headache condition that led to the deferral on the MRC, but I’m no brain scientist.
Asteron paid the full $87.5k, with no 3-month standdown on the increased sum.