Any process that prolongs an adviser’s ability to get a protection plan in force is the potential cause of an NTU. Managing clients’ expectations through such processes so that they understand what is happening, and most importantly why, is key to keeping them engaged. Medical underwriting is a prime example, but which insurers offer the highest limits for healthy lives before such evidence is automatically requested reducing the risk of medical evidence being needed?
All insurers issue non-medical limit documents which highlight at which point they would request different medical evidence based on the life assured’s age and the sum assured. Whilst these seem to be fairly standard, the age basis used within the document is particularly important.
There are two different age basis that could be used, age attained or age next birthday. Where age attained is used the guidelines should be fairly simple, however where age next birthday is used advisers need to add a year to the client’s age in order to ascertain what bracket they fall into.
If advisers are looking to compare two insurers, then it is particularly important to understand the age basis each insurer uses. If a client is 40, for example, then they would fall into the age 36-40 bracket for an insurer that uses age attained and the 41-45 bracket for insurers that use age next birthday.
Providing medical evidence can be a barrier for some clients. In such scenarios, advisers could consider making applications to insurers that have high non-medical underwriting limits to ensure that the client is not inconvenienced.
The graph below highlights the sum assured at which medical evidence would be requested for life cover based on 30, 40, 50 and 60-year-old applicants. For clients aged 30 the limit at which medical evidence would be requested ranges between £700,001 and £800,001. For age 40, this decreases to between £500,001 and £700,001, age 50 is between £250,001 and £500,001 and age 60 is between £100,001 and £300,001.
Once these limits are breached the type of medical evidence required will depend on the age of the client, with younger clients more likely to be asked for a medical first and older clients a General Practitioners report.
This aside there are many different types of medical evidence that may be requested, with some more intrusive on the client’s time and body than others. Whilst each insurer may ask for different evidence based on the client’s circumstances the most commonly requested are:
- General Practitioner’s Report/GPR
- Mini-Screening/Nurse Medical Screening
- Doctors Medical Examination
- Fasting Lipids
- Electrocardiograph (ECG)
- HIV Tests
Historically, obtaining a General Practitioners report could take weeks and in some cases months. Unlike client medicals, where it is easy to pursue the client and insurer in order to set a date for the appointment, a GP surgery is harder for the adviser to chase and therefore the timescale of returning these is largely out of their hands.
AIG, Canada Life and Old Mutual Wealth will not request a GPR based on the life assured’s age or the sum assured. Whilst they do not rule out requesting a GPR altogether – they may request one where there is a specific medical condition, they want to learn more about – this could be a positive for many advisers. The table below shows the sums assured at which a GPR will be requested and highlights the wide range in approaches across insurers.
*AIG, Canada Life and Old Mutual Wealth will not automatically request a GPR
Although advisers may have no control over how long a GPR takes to be returned to the insurer, from a client’s point of view this is less intrusive on their day to day life than a Nurse’s or Mini Medical might be. Where this may be a barrier to the sale it is worth understanding the different insurers limits to understand whether the cover required could be supplied without the need for a medical.
A Nurses/Mini Medical (or screening) is generally not as intensive as a full Doctor’s Medical examination and can be organised by your client at a time that suits them. These will usually involve a cotinine (smokers) test as a standard for non-smoking clients.
Providing the client with details of what medical evidence may be required in advance of an application can highlight the expertise and knowledge of the adviser. In addition, it can also reduce not taken up rates as the life assured is aware of what is required of them without any unnecessary surprises.
For younger life assureds the limits on medical evidence is generally quite high and therefore unlikely to have an impact on the majority of clients. For older clients however, the sum assured limits are relatively low and therefore much more likely to be a consideration. If all else is equal then clients may well prefer to go for an insurer that is not going to intrude on their day to day life.
Overall, Canada Life have the highest limits before medical evidence is required for younger lives, with Guardian offering the highest limits to anyone post age 40, so applications have a higher chance of going through before triggering a requirement. It’s worth noting that Old Mutual, Canada Life and AIG do not auto-request a GPR based on sum assured limits alone with LV= offering good terms when it comes to the potential of a Nurse’s/Mini Medical being required.