The payment level for adult full payment conditions remains at the lower of £50,000 or 50% of the sum insured whilst the amount payable has been increased from the lower of £25,000 or 25% of the sum insured to the lower of £30,000 or 50%.
For children the maximum payment has been increased from £25,000 to £30,000 with the maximum percentage remaining at 50%. Terminal Illness has been included as has a £5,000 child death benefit.
Additionally the payment for still birth has been harmonised with the child death benefit and has also been increased from £5,000 to £10,000.
Alan Lakey, director of CIExpert, said: “These improvements are welcome as they provide for increased payments for both adults and children. Whilst the payment level change may not seem particularly large the impact of changing the limit on payment from 25% to 50% is much more significant than an initial glance suggests.
“With the previous additional payment level of the lower of £25,000 or 25% the sum insured, on a decreasing term plan, started to reduce for any sum less than £100,000. The level of payment progressively reduced as the remaining term reduced.
“Shifting to a payment limit of 50% means that a reduction only occurs when the residual sum assured drops below £60,000 and therefore has a much more significant impact than one might imagine. This is because the likelihood of a claim increases with age at the very time the insured sum reduces resulting in a reduction to the amount paid.
“Royal London has been offering superior children’s cover for many years and these improvements serve to strengthen their position. It is pleasing to see an increasing focus on covering the significant impact on a family of pregnancy complications and the loss of a child pre-birth.
“This cover together with the congenital condition coverage of the Enhanced policy serve to illustrate to the adviser the importance of getting this cover in place as soon as starting a family is being considered.
