Why PruProtect Essentials?

A quick review of PruProtect’s new offering (PruProtect Essentials) suggests they have removed some of the key selling points of their cover to create a cheaper ‘budget’ option.

The questions that need to be asked are ‘does it make their Essentials cover inferior?’ and ‘will anyone actually benefit from the cheaper option?’

So what are the main differences between the standard PruProtect cover and their new Essentials option?

The following PDF file highlights the main differences http://www.pruprotect.co.uk/pdfs/life/essentials_overview.pdf

The information reveals that the Essentials option does not include:

1/ Vitality Rewards – with the standard cover, policy holders can lower their premiums by living healthily and attending a gym)

2/ Automatic Childrens Serious Illness Cover – with standard cover 50% of the parents serious illness benefit (up to a max of £25,000) is available for each child up the age of 18.

3/ Guaranteed Insurability Option – this allows the policy holder to increase cover without further underwriting.

4/ Immediate Cover Benefit – this provides life cover while an application is being assessed and before the policy actually starts.

5/ Free Cover for Mortgage – free cover while a mortgage is being processed

In addition to these 5, applications can only be submitted online and the interest rate for decreasing cover is 7% whereas standard cover offers a rate of 10%.

The people who would benefit from not having these 5 options in exchange for cheaper cover will ONLY be people who have no need for them.

i.e.

Someone who does not go to a gym (or does not want to adopt the Vitality program)

and

Someone who’s children are all over 18

and

Someone who is unlikely to need to increase their cover

and

Someone who either already has some cover or has no need for cover to be immediate.

This is therefore something that could benefit quite a variety of people.

For example, Mr. Smith is 50, he walks the dog but doesn’t go to the gym, his children are all over 18, he is not likely to move or increase his mortgage debt and he has decided he would like some serious illness cover.

The PruProtect Essentials policy could suit him perfectly if the cover and the price is right compared to other insurers.

Equally, Miss. Jones who has no children, an existing small mortgage and a step machine might fail to see the benefit of the options available with the standard cover and be drawn towards an Essentials policy.