Better off dead? The need for critical illness cover

Hello and a warm welcome to today's webinar. I'm Shelley Reed, Senior Technical Manager, and I represent the protection side of our business here at Royal London. I'm delighted to be joined today by Joe Legg, also protection expert at Protection Guru. And over the next hour we are going to explore the importance of adding critical illness cover to your client's protection portfolio. And Joe's going to run through a short demo of Protection Guru's Comparison Tour. But I'll leave Joe to tell you more about this in a little while. So welcome to the webinar, Joe. If you are listening live today after the webinar, you'll receive an email which will take you to our CPD hub. And after you've successfully answered our CPD questions, you'll then be able to download your certificate. But bear in mind this email can take up to 24 hours to appear in your mailbox.

So as you can see, today's webinar is entitled Better Off Dead. That's quite a startling title I appreciate, but all will become clear in the next few minutes. So without further ado, let's get started. And if we move to our next screen, you'll be able to see our agenda for the next hour. So we're going to explain the startling better off dead title. We'll have a look at just reminding ourselves about critical illness cover, how it was set up and bringing it up to date today we'll have a look at the risk, chance and probability and examine ‘it won't happen to me’. We'll then have a look at income-based critical illness cover and particularly the type of clients that could benefit from this type of solution. We'll look at the importance of talking about critical illness to business owners and then we'll round up with some final thoughts before handing over to Joe.

Now if we go to our next screen, we will be able to see our learning objectives. It wouldn't be a protection training event without some, we've got four today. So briefly, I hope you have a better understanding of the importance of including critical illness cover in your client's protection portfolio and to be able to describe some of those additional features, understand the types of clients and income-based critical illness plan would be most suitable for, and identify some opportunities within your client bank to discuss that critical illness cover. So let's get into our main course slides now and let's just revisit our title Better Off Dead. Now the reason we called it this is that obviously not emotionally, but financially for most families, if the main wage earner were to have a critical illness, then as I say not emotionally but financially, it almost might be better if they had just life cover that maybe they didn't make it, that they didn't recover from that heart attack.

Now obviously I am making slightly light of that, but I'm just trying to make the point that if the main wage earner has only life cover and no critical illness cover in place, then financially for the family, not emotionally, financially it might've been better if they hadn't made it. Now let's have a look at our next screen. And I just wanted to further explain that by just giving a brief example. We've got Kieran and his wife Joy. They've got two younger children and Joy's a part-time civil servant, and Kieran is a self-employed accountant. Now they've got a joint life only protection policy, which they took out when they brought their house. Now sadly, Kieran suffers a severe but not fatal heart attack. Now obviously had he passed away then Joy would've been able to claim on the life only protection policy. But what we find now is that Kieran is going to have to take a significant time off work and remember he's self-employed, so no employee benefits then this is going to really test their financial resilience.

Let's have a look at the next slide. And I just wanted to look at some, just some statistics to show actually where we are sitting as far as critical illness is concerned. So if we look at homeowners: owned right homeowner with a mortgage and in rented accommodation, you can see the percentage stats there of owning a policy. Now our core subject today is obviously critical illness. So if we concentrate on those areas, homeowners outright about 8% have critical illness cover homeowners with a mortgage 33%. So that's really very promising, but still probably not high enough. And those in rented accommodation, only 11% have critical illness cover. And I'm going to revisit this in a little while when I look at income-based critical illness cover. So let's move on to our next slide please and just have a few thoughts about understanding critical illness cover and exactly what it offers to your clients.

Now if we look at the next slide, we are just going to have a short history. You can see here from these dates that we just last year had 40 years of critical illness and I think we're all aware of the story of critical illness starting with surgeon Dr. Marius Barnard, who actually persuaded a South African life insurer to develop the world's first critical illness insurance policy. The idea for a new kind of policy came to Dr. Bernard because he realized patients were surviving operations, but these operations were providing either life changing or life limiting experiences. So Dr. Barnard realized that what really was needed was a policy that rather than paying out on death, actually paid out on the diagnosis of a health event that would either be, as I said a couple of minutes ago, life-changing or life limiting. Now he persuaded a life insurer called Crusader Life to develop the world's first critical illness insurance policy, which really started to gain traction outside of South Africa and was brought to the UK just two years later.

Now, while the first advisor plans were covering about 16 or so conditions, insurers were really in competition and were trying to outdo each other and it did really become a bit of a conditions arm race. Now, a key innovator in cleaning up the market, so to speak, was protection advisor John Joseph, who created the working party to standardize critical illness definitions. And it was thanks to his campaigning that we had in 1999, the first ABI (Association of British Insurers) Model Critical Illness definitions. And we still see that in our working life daily and now we have an updated version of that today. So in addition to the ABIs work, another big milestone for critical illness came in 2006. Now up until that point, by and large insurers were paying out lump sum benefits. So, what Vitality did and innovated around was bringing in partial payments.

So, there could be a partial payment of a sum assure depending on the severity of the condition. Now many insurers, us included, now offer partial payments and quite often these are for such conditions as low grade cancers. Now bringing the story up to date in times in which we have to admit the NHS itself is in a critical state. I think that Dr. Bernard always saw the need for the industry to work with the health service in really keeping the policy holder healthy for as long as possible. Now that means the sector I think needs to give their policy holders lifestyle advice and advice on exercise and diet. And in doing that it might be possible to delay that claim happening or it might even prevent it from happening altogether. So I think this brings benefits for the individual, for their family, for the sector and society as a whole.

And equally it would be a big plus for the health service too if the onset of limiting health conditions and also acquired disabilities could be delayed. And we'll look a little closer at support services that come with modern critical illness plans in just a little while. So if we move now onto our next slide. Thank you. Let's have a look at a bit under the bonnet of critical illness cover and have a look at some things that I wanted to point out. Just remember that critical illness generally pays out a lump sum or it can pay a series of lump sums on the diagnosis of a specific illness. Generally it's arranged as standalone cover or it can be combined with life assurance too. And remember, some critical illness policies do require a survival period from diagnosis of a critical illness to make a successful claim.

And underwriting is based on morbidity risks rather than mortality risks when we're talking about critical illness cover. I think it's also useful to remember that critical illness can be set up on a level decreasing or increasing basis. And we'll touch on this again when we're talking about critical illness as an income. And remember I mentioned it when we were looking at the history of critical illness, but some policies do allow for partial payments if clients are diagnosed with a less severe critical illness. And for most modern insurers, those partial payments don't come off the lump sum. So if you had a 100,000 critical illness cover and received a partial payment of say 25,000 for maybe low grade breast cancer, then the 100,000 is still intact if that cancer developed and a successful for critical illness was able to be paid out. So just some things I wanted to point out for you.

Now if we move to the next slide, I think it's important to mention when we're talking about critical illness is to mention children's critical illness. Now this is typically taken out alongside an adult critical illness policy and it's normally pays out a percentage of the adults, sum assured now a claim on children's critical illness policy, again, just like partial payments doesn't affect the adult's policy. I think that's really important to note and some insurers allow real flexibility so it allows children's cover to be added or removed without the need for additional medical evidence. Now that can be really, really important I think if we're talking to clients who as yet don't have any children or haven't thought about starting a family, so they might not want to have children's critical illness cover that they clearly couldn't make a claim on currently. And also at the other end of the spectrum, like myself for example, where my son is too old to make a children's critical illness cover payout, then again I might want to remove that from my plan.

And some insurers do allow for a child to take out their own adult cover when they are older. Obviously there will be certain restrictions and certain amounts that are involved, but I think that's a really great addition to adult critical illness cover. So if we are looking at some of the percentages and some of the research that's been done around families with, sadly with a sick child in hospital, you can see here that 28% said they'd gone cold to avoid using heating at home and increasing those fuel bills. More than 40% had asked families or friends if they could borrow some money and 58% that said that they had cut back on non-essential spending. So I think it's very important when we have clients with children and we are talking to families to discuss children's critical illness cover. For many of us on the call today who are parents, I think the very worst thing we could ever think about is having a sick or ill child that's maybe in hospital and we're trying to juggle work at the same time when really all we want to do is give all of our attention to being with our child and making sure that they recover and get better as quickly as possible. And having a lump sum of money allows many families to be able to do that.

Right. Let's move on now. And I just wanted to mention about understanding critical illness cover when we are writing a plan in trust, I just wanted to point out that it's important that they're written into a special type of trust which allows for the life assured to benefit if they suffer a critical illness and their beneficiaries to benefit if they die. So just make sure that we have got the right trust that has that special type of clause in that allows on a critical illness claim that the life assured or the donor or settler, that we sometimes call them, has the ability to receive the proceeds from a critical illness claim. Right. Let's move on to our next slide please. So here I wanted to talk about the added value services that come with most modern protection policies.

Now we have always thought at Royal London that a really good protection plan was about more than just offering financial support. So we also via our added value services offer more tangible services, digital support, and real help with mental health. So you might have heard about Helping Hand, it's our support service that's included in all our protection plans available through intermediaries. Now it's run by Redarc Nurses and it's available to your clients whichever stage in life they're at. And as a plan owner, it doesn't cost them anything extra to use. So our support service includes a wellbeing support area designed really to help your clients maintain a healthy lifestyle. It gives the plan owners online access to a range of handpicked early care medical services. So they have help and advice that they need to stay fit and healthy. And really the idea is that it will help stop small health issues becoming a much bigger problem.

And if the plan owner or their partner or children are going through a difficult time such as a serious illness injury or bereavement support services such as Helping Hand will also be there to offer support even if they don't need to make a claim or even if they have an unsuccessful claim. So these days with comparison sites and price competition, it can be hard to see what sets some policies apart, but I really think that by recommending cover that offers these type of tangible benefits and additional support, then you really are giving your clients more than they might expect when they take out cover. They're planning for the very worst that can happen and often they really can't think or even imagine ever making a claim. But many of your clients and many of us still go through testing times in our lives and have to face issues such as periods of ill health and bereavement.  So support services such as helping Hand included in your client's protection plans are really designed to look after their physical and mental wellbeing as well as being there with more practical support in times of crisis.

So even if they don't need to make a claim, it can show the value of your advice and help to build long-term relationships with your clients, which can only be good for your business. So there might be times when your clients want some help keep their wellbeing on track. And if your clients choose to take out a menu plan with Royal London, the plan OLAS will get an online access to a range of early care medical services, which can help them understand how small changes in their lifestyle maybe could help to improve their overall health. So at Royal London, we've handpicked some services that we offer based on issues that most commonly affect our customers so that your clients can get support that really helps to make a difference to both their mental and physical wellbeing.

So, we have Health Hero, which is a 24/7 access to a virtual GP consultation by real experienced NHS doctors. And this can be really handy if clients are struggling to see their regular GP. We have Thrive, which is all about support with mental wellbeing. And with this NHS approved app, clients can get real personalized recommendations to help prevent detect and self-manage mental health conditions such as stress and anxiety. They offer a range of techniques to help clients build their resilience and improve their overall mental wellbeing. And then finally, Track Active Me, which was created by physiotherapist. This app can help diagnose a musculoskeletal problem and gives clients access to physiotherapy advice and some personalized exercises to help support their recovery. And this can be a recovery from a real wide range of injuries and conditions and clients will have access to a library of exercises for at home or in the workplace to really try and help them keep strong and injury free.

Now when we're talking about helping hand support services and particularly with an eye on our core subject critical illness today, I thought it might be useful just to share a few of the areas that you wouldn't maybe particularly express, but just will help you to understand some of the really wide breadth of support that's available. So for example, we were able to provide or Redarc Nurses were able to provide an exercise bike for a teenager who had to have a bone marrow transplant. She was so weak that she'd lost the use of her legs, it was recommended by a physiotherapist, but unfortunately the hospital one was broken and she was in isolation so she couldn't go to the hospital gym. And also we provided the provision of a reclining chair so a wife could sleep next to her husband in a nursing home. The nursing home didn't have one, so she had to leave him to go home to get some rest and this meant that she could have quality additional time with him.

And after he died, she did pass it on to the home for relatives of people who were in a similar situation to her. And we provided a weighted blanket for a child who was extremely anxious after the illness and death of a parent. And these weighted blankets emulate having a hug and it can help to reduce stress and aiding relaxation and promoting sleep for this little one. So as you can see, a wide breadth of support available and with only 16% of policy holders just over being aware of added value support services, we're so reliant on you as advisors to remind them of this support. Maybe this might be a really good conversation at review meetings. So as we move away from support services, now let's on our next screen have a look at critical illness versus income protection. This is sometimes a question our sales teams often get asked by advisors, and I think it is all about looking at the personalized situation of the client that you have in front of you.

So, the target audience that really I meant by here, the actual client and their situation, do they have a mortgage? Do they need a lump sum? If they had a critical illness, what's their employee benefits? And I think at the end of the day, the ideal situation is to have a menu plan that includes both critical illness and income protection. I think it's important to describe the role of critical illness and income protection to clients so they can help to have an informed decision. And also to look at the need I mentioned a minute or so ago looking at someone's circumstances if they were to have a critical illness or indeed something less serious but still needed to take some time off work, are they self-employed? Do they have any employer benefits? Those sorts of questions are imperative, I think to make a proper informed recommendation.

And the price, of course, this always needs to come into it. We need to be mindful of a client's budget and I think quotes to compare lump sums of critical illness versus income-based critical illness and also income protection really will help your clients to make an informed decision. So let's move on to our next slide where we are just looking at multi-benefit solutions. And here I'm talking about a menu plan. So you can see here I've highlighted all the different areas, all of the different products, and just to have a look, we sometimes call these the 4 Rs. And we really do think that multi-benefit solutions, they are difficult to copy, which we think does reduce the risk of cancellations and policies lapsing. So this has got to help you to retain clients. Again, bespoke solutions that demonstrate quality advice and show that you have built a protection portfolio that not only suits your client now but is flexible enough to change as they life their career, their home and their family evolve has got to help really to build your reputation.

And with a menu plan or multi-benefit solution, you can offer far more solutions to your customer, creating, again, increased revenue for your business. And managing risks when it's needed most with multiple opportunities to claim. So an ideal solution might be for someone for example, with a mortgage of a hundred thousand might be to have a life and critical illness policy in sum assured of a 100,000 but that might be outside of their budget. So having a smaller amount of critical illness may be perhaps a year's salary coupled with some income protection all in a multi-benefit solution might be a better solution for your client giving them multiple opportunities to claim. So let's move on now and have a look at, it won't happen to me. So this is the Superman / Superwoman syndrome that really thinks that they're young, fit and healthy.

They may well revisit in the future, but currently they think it won't happen to them. And this is really all about talking about the risk, chance and probability of someone diagnosed with a critical illness or indeed having to take some time off work. Now if we look at the statistics on the next screen, I know it's no surprise to you that these are the three top reasons for critical illness claims across the industry, cancer, heart attack and stroke. And just some interesting facts I think about these three conditions. Cancer first, nearly one in two people born in the UK in 1961 will be diagnosed with some form of cancer during their lifetime. Now that's a really scary statistic, isn't it? And if we are looking at heart attack every five minutes, someone is admitted to a UK hospital due to a heart attack. So if you think we're going to be chatting for about an hour today, that's an awful lot of people in the UK that sadly have suffered a heart attack while we've been talking.

Now the number of people in the UK experience a stroke is set to increase to 151,000 per year by 2035. So you can see all of these areas. We doubt that a number of critical illness claims are going to diminish, they're only going to increase. Now let's have a look at the next slide and just carrying on with the reasons for claim. As we highlighted on the previous screen, the chance of being diagnosed with cancer is something that sadly one in two of us are likely to go through in our lifetimes. But when we are looking at the cost of cancer and the hidden cost of cancer that we gleaned this information from Maggie's then 83% of people with cancer say that unexpected expenses since their cancer diagnosis are impacting their mental health with over a third 36% feeling that impacted strongly. And 78% of people with cancer are struggling to pay bills because of the unexpected costs that come with a diagnosis.

And you might be thinking what might those unexpected costs be? Well, they are listed as such things as having extra travel costs to and from medical appointments. The cost of parking going at a hospital ground or nearby, maybe bigger heating bills as people are recovering at home, may be a change in diet due to eating restrictions or a desire to eat more healthily and things like prescriptions and additional toiletries to help with some of the side effects of treatment might also impact on their financial resilience. So let's have a look at our next screen when I wanted to talk to you about a partnership that Royal London have with Cancer Research UK. Now in 2023, just a few years ago, we entered into a partnership with Cancer Research UK with a goal of tackling cancer inequalities to enable people to live longer, better lives free from the fear of cancer.

And I've got to admit that until I got involved in hearing about this, I didn't really understand the inequalities of cancer. So we know that preventing cancer is one way we can help customers avoid the health shock that can significantly impact on their financial resilience. But let me just run through the areas that we are helping to fund. So the first area of funding is to Talk Cancer, and it's a cancer awareness training program created by expert nurses. So the training helps people have real impactful conversations with others in their community about how they can reduce their risks of cancer. And importantly, how to spot it earlier. So talk cancer aims to reduce health inequalities by prioritizing training in locations where more people are affected by cancer. Now the second area we're contributing towards is research into hard to treat cancers. Now, although cancer survival rates has doubled in the last 50 years, progress hasn't been equal across all types of the disease.

So cancers such as brain, lung, pancreatic, esophageal, liver and stomach cancer. Although survival has improved, it's improved very little and these cancers are hard to treat successfully and there are limited routes to new therapies. So Royal London and Cancer Research UK are funding research focused on beating these cancers, helping to overcome cancer inequalities and improve cancer survival for all. Now the third area we are funding is a program called Test Evidence and Transition. And it's aiming to accelerate innovations in the health system to improve cancer diagnosis through treatment. Now throughout the program, Cancer Research UK have worked with frontline NHS teams and academic partners to test new approaches to gather evidence and transition them really rapidly into reality, ensuring that everyone benefits from these innovative approaches more quickly while reducing inequalities experienced by patients in their cancer care. Now if we look on the next screen and talking about helping to demonstrate the risk, you can see our family here.

We mentioned them a little earlier. Now this male is 32 years old, Kieran, he's got a retirement age of 68, he's a non-smoker. Now let's have a look at what is the chance of an unexpected life event happening that's going to really test this financial resilience? Well, Kieran has a 5% chance of dying during his working life. He has a 21% chance, four times as much chance of being diagnosed with a critical illness. Now 29% chance of being off work for two months or more. Now that could be because of critical illness or it could be of an illness that's less severe, but still needing to take an extended time sick off work. And if you add all of those together, there's a 47% chance of any of those risks happening before the age of 68. Now if you are thinking those statistics are really powerful and I really think that they are, and it would be really great if you had those statistics to talk to each and every client.

Well, I managed to get these statistics from an area of our Royal London adviser site called a Marketing Studio, and this is from a one page risk report. Now sadly, I don't have time to go into great detail about that today, but please contact your normal sales BDM who will be more than happy to show you really how easy it is to provide those personalized statistics for each and every client. Now as we move towards the end of the things I wanted to talk to today, let's have a look at income-based critical illness cover. Now, if we look at our next screen, family income benefit policies that provide an income rather than a lump sum can be a really efficient way to protect against the loss of an income following a death or a critical illness. And that's what I wanted to talk about for the next few minutes.

So, we are looking now at providing critical illness on an income-based solution rather than a lump sum. So who would be a good client to have a conversation with? Well, first of all, a client who is privately has decided to privately educate their children. I don’t know if anyone on the call today has taken that decision, but it's a really massive financial commitment out of net pocket and on diagnosis of a critical illness it might be with a loss of income that those school fees or indeed university fees and the associated costs can't actually continue, but that doesn't need to happen. Having a family income benefit policy set up on a life or life or earlier critical illness basis can provide an income to make sure that those school fees can be maintained. Now also, a client who is divorced and either paying or receiving child maintenance, this can be a really good way to look at protecting that monthly income.

So, child maintenance normally lasts until a child is financially independent. That might be after they finish their education. But a family income benefit policy on life or standalone or life or critical illness can be set up to replace that income if the person paying the maintenance sadly passes away or is diagnosed with a critical illness. Now I mentioned a while ago the rental sector. Now admittedly, someone in the rental sector doesn't have a large sum to protect like a mortgage, but they certainly have monthly outgoings such as their rent and utility bills. Now, if they were diagnosed with a critical illness, that might mean that those bills are really difficult to maintain when if someone is self-employed or indeed when their employee benefits run out. So again, setting up a family income benefit policy, either on life or critical illness or life or earlier critical illness can kick in and make sure that those rental commitments and monthly bills can be maintained. Thus, meaning that someone doesn't have to move to a smaller property or maybe to a less desirable area.

And when we're talking about the rental sector, then the majority of people still have aspirations to buy their own home. So might be avidly saving a deposit to have that much long for a first home, first purchased home. Again, if a critical illness occurs, it may well be that families couples have to dip into those hard earned savings to pay their rent and a Sainsbury shop or utility bills, this doesn't have to be the solution. Again, their much hard earned deposit can stay intact if they have a policy that will replace that loss of income. And finally, families, I think we used to have a phrase that I still think is as relevant today, which is kids can't eat bricks. And what I mean by that is for most families with the loss of a wage earner or a wage earner being diagnosed with a critical illness, if they sadly then lose their income, if they have a mortgage protection policy and their mortgage is paid off, then that's obviously great that the properties owned.

But for most families, they also need an income. Just having that mortgage repaid doesn't reduce many of their other fixed costs. So to ensure that they can stay in the property and maintain some lifestyle, it's a really great solution I think to have a family income benefits set up a side a lump sum too. So let's move on now to business owners that I mentioned in our agenda. And I think it's important to talk to business owners not only about loss of life, but also about diagnosing a critical illness. Now if we move on to the next slide, the two areas I think are worthy of this critical illness conversation are business continuity and business succession. So business continuity, we're talking if a director or key person of a company is diagnosed with a critical illness, how would they source a replacement? How do they get someone into that company to help cover that role while they're off sick?

And what are the financial consequences? Do they have loans and debts that they need to repay? So looking at key person protection and loan protection, not just on life but on also on diagnosis of critical illness is a really a good idea. And business succession. If someone is diagnosed with a critical illness and they have to take long-term sickness leave from the business, or indeed it may be that they can never return to the business, what will happen to those shares? Well, we want to get fair value for those shares and we want to make sure that the control of the company stays within that firm and the other directors or shareholders that built that up. So again, a conversation about critical illness in respect of shareholder protection can be a real benefit for those small business owners. If we move on to the next screen, I just wanted to raise the idea of talking about a risk to a business owner of their exit strategy.

Now there are really probably only three exit strategies. The first one really is to sell the shares of their company. Now at the point of this happening, the questions really need to be asked is to how much is their share worth? And indeed, who might actually buy that and how attractive is the business at the time when maybe one of the main directors has been sick for a long time having been diagnosed with a critical illness. Now the second area is to look at passing those shares onto a family member. Now the questions here to consider is are they interested in taking over and indeed, do they have the skills to be able to run that business and who would they actually be able to sell their shares to in time? Finally, it might be an exit strategy that someone will work to the bitter end, but how realistic is this?  Is it a viable option? How is their health now? And no one knows what their health is going to be like in the future and could it also affect their contributions to their pension?

So lots of areas to talk about, again in the means of this webinar, having got time to go into these areas in detail, but I just wanted to raise awareness that it's an important conversation to have with your business owners about the chance of diagnosing an critical illness. Now as we just come to the end of my section before a handover to Joe, I wanted just to put together some final thoughts and if we look at the next screen, please. Thanks. Consumer Duty, one of the points that came out of Consumer Duty was avoiding foreseeable harm and a firm must act to avoid causing foreseeable harm to their customers. Now, foreseeable harm can be as a result of premature death, serious illness or long-term sickness.

And we know that it can have a major impact on a client's financial resilience and protection advice can be the financial safety net. So really when we are looking at foreseeable harm, I think that we have a responsibility to talk to our clients not only about the chance of dying prematurely, but also the chance of being diagnosed with a critical illness and having to take some time off work sick could that potentially, if we don't have that conversation look to be causing some foreseeable harm for our customers. Now that's really all that I wanted to chat to you today. I think on the next screen you will see our learning objectives that I think will now have become outcomes. So what I'm going to do now for the final part of our webinar is hand over to Joe from Protection Guru that I mentioned at the beginning of our webinar. And Joe, I think you're going to give us a demonstration.

I am indeed. Thank you for having me today, Shelley. Fantastic session so far. So I hope I can deliver the same. So, Protection Guru Pro is a quality analysis system. So today I will be demonstrating the system live for you. So to give you some background, we provide quality analysis on life, critical illness, life and critical illness, family income benefit, income protection, and business protection. So from your point of view, there's the full suite in terms of the quality analysis and I think it's really important, especially with consumer duty, that we have a responsibility to ensure that we're looking at the quality, the fairness, and the value of the proposition. Now, what makes Protection Guru Pro different in the industry is how our analysis is compiled. So I think it's fair assumption to say that none of us on today's calls are medical experts.

I think certainly as an industry we talk about medical history and the chances of getting sick and unwell and clients feel that there's that natural understanding of medical information which we don't have. So here at Protection Guru, we have a panel of private practicing Harley Street doctors and specialists and they complete the analysis for us. So they will look at the client's gender, their age, smoking status, the term of the contract because that can have a big impact on medical futures. Their occupation, again, they understand the prevalence of disease and we use UK diagnosis data. And the reason that we use that and not the claims data is ultimately for every five clients that have had a successful claim, there'll be five clients in the UK with no cover in place, which we would not be able to record, which is why our doctors use the UK diagnosis data. So that gives you a little bit of background around Protection Guru and how the analysis is compiled. So we're now going to go into the demonstration. So when you log into Protection Guru Pro, you'll walk straight into your dashboard and here you can see any previous analysis completed. For the sake of today, I'm going to create a new client. So we're simply going to ask for some basic client details, nothing that you wouldn't already know. I'm just going to quickly pop some information in.

And you'll see there we had various options for the employee status and if you start popping in the first few letters of the occupation, all the options will come up. So as I mentioned earlier, before I started the demonstration, we do offer quality analysis on various contracts, but to keep in line with the theme of the fantastic information that Shelley's just shared with you, I'm going to be looking at life and critical illness. So now we're just going to ask for some quotation details. Again, nothing that you won't already know, waiver and TPD is very self-explanatory, and if the client has children, we purely ask for their age and gender. And the reason that we've asked that is our doctors have completed analysis on the children's cover and ultimately if the client has more than one child, you can add various children here. So when looking at critical illness, you can review an existing contract compared to today's, but for the sake of today's demonstration, I'm purely going to look at today's contracts.

So, depending the contract that you select will depend on three key questions that we will always ask, and this is very much personal to your client as an individual and ultimately what's important to them. The first question is do you want to run the analysis just on critical illness? Well, I'm going to say no. I want to look at the life and critical illness element. Is the client planning to have or have more children? I appreciate these things aren't always planned, but we need to go with what the current plans are. And again, the reason that we've asked that question is our doctors have analysed pregnancy cover and then is the client interested in accessing value added benefits? Well, they're becoming more and more popular. So I'm going to say yes to that question. So here we have a quick recap. If you're anything like me and you're fat fingered and you've typed the wrong year for the date of birth or you've misspelled something, you can click edit and edit that section accordingly.

But I'm going to say get results. So this is now analysing the client's individual details to provide the quality analysis results along with the pricing feed from iPipeline. So you'll see here we always default our order by quality and at the moment we have 42 results, which that's a lot for you and your client to filter through. So here on the left-hand side, we have our filters, which is where I like to say we're going to remove the noise. So you've got your options on premium type and I think it's important to highlight here, we are not a sourcing system, we are a quality analysis system. So we will pull all of the pricing options in terms of those policies from my pipeline. So I'm going to say on this occasion that we're looking for guaranteed premiums only, so I'll remove anything reviewable. Then looking at children's cover, well my client has an 11-year-old son, so I don't want to include anything where children's cover is not included.

And if you are not a fan or your client is not likely to engage in the vitality optimization plans, you've got the option to remove them there. So we've literally halved those results. We've gone from 42 to 22. Now as you can see here, you have your overall quality score and then the price from solution builder. You'll also notice here that we've highlighted overall best quality for this client. And as we scroll down, you'll see the quality scores reduce. It doesn't always mean that the price reduces, but we'll also highlight for you lowest premium. This will really help you in terms of your recommendations as to why you've not recommended the cheapest.

Okay, so here we have a client budget option. So let's say your client has a budget of £68. We scroll through. Now what you'll see here is we've also highlighted the best quality within your client's budget and every contract that falls within your client's budget. So what's this telling you right now? Not a great deal. We've got an overall quality score and a price, and we have an idea of actually who is the best quality contract for your client taking into account compliance and Consumer Duty requirements. But we need to look at that detail. So from here you can select three providers to do some detailed analysis on. So I'm going to select the overall best quality for my client. I'm going to select the best quality and budget, and I'm going to include the lowest premium to explain to my client and compliance why I've not selected that.

So, you'll notice as I clicked on the logos, it's now brought this to the top of the page. So if I click compare providers, we will now show you a breakdown of everything that's been analysed and the quality scores within that. So you can see here you've got your three providers along the top, you've got the overall cost and the overall quality score. And if we look here, there really is quite a difference in terms of actually from a Consumer Duty angle, which is the best contract to be offering my client. So here you can start bringing the direct debit to life and really bringing that policy to life in terms of what is your client buying into and what features do they have available to them. So if we take a look at the cheapest contract to start with straight away, you can see here the doctor's analysis of the children's critical illness conditions is scoring very low.

Let's face it, you can't put a cost to your child. As we scroll down here, you'll also see from the life cover perspective, the cheapest contract does not offer a mortgage guarantee. Really, let's take that to back to basics. Why are you taking out the life cover? We can't predict what the Bank of England were going to do a couple of weeks ago, let alone what's going to happen in the future. If mortgage rates get out of control, there's no guarantee here that that mortgage would be paid off. So you can start pulling out the reasons why you're not recommending the cheapest, but also showing to your client that value of them speaking to you as an advisor rather than doing something themselves. So then we can start looking at the overall best quality contract for the client and the best quality that's within their budget and really start to pull out the differences.

So again, for me, this would be a key one in terms of that analysis for the children's cover, which again has been completed by the doctors. This one is scoring extremely low. The overall product features are scoring much lower. And again, we don't have a mortgage guarantee option. And the guaranteed insurability options, again, are scoring really low and that's something you want to consider for the future in terms of making future adjustments to the policy. The overall critical illness analysis, again, is scoring quite low to the cheapest. So here you can start bringing out why you are recommending who you are. If I close that down, I'm going to walk you through the detailed report. If I select download report, the short report is purely a PDF copy of what I've just shown you. So I'm going to walk you through the detailed report. So here we have our three providers and now we ask who are you going to recommend?

And I'm going to say, we are recommending Royal London actually for £4 a month over budget, which is still affordable for your client. This is the best quality contract for them. It means from a Consumer Duty point of view, you are meeting your requirements. This is going to support your compliance in terms of your recommendations, but also you know that you have recommended the best quality contract that there is specifically to this client. So the detailed report, were very honest and transparent in terms of our benchmarking and what our doctors do. We then have the client and the quote details and what filters I applied, and then the three providers that we're reviewing along with those that we did not include in our analysis.

So, I'm going to focus on the slides today that the clients really do engage with, and these are the slides, they are very visual, and it really does help bring the policy to life. So we'll start with the critical illness analysis. So here you'll see what we've analysed and how that's been weighted. So the overall quality score for each provider, this would be why I'm not recommending the cheapest and actually this is why we're recommending who we are. So what you are doing here is you are ultimately writing your recommendations. Okay, so your reasons why. Now Royal London do offer a Risk Calculator in terms of chances of being unable to work and so forth. So this works really nicely. So if you are using the Royal London Risk Calculator, these two go hand in hand because our doctors can show your client the five conditions they are most likely to get during the term of the contract term is the key word there.

So, depending on the term, those results can look very different that this client has a one in seven chance of suffering, stage one to four cancer during the term the policy. You'll see here what's been analysed. So the focus is on the five conditions along with all other conditions and the waiting breakdown here. And again, I think ultimately from this point of view, your recommendation is that a reflection of you and your advice. And ultimately when it comes to that call to say, I need to claim, you want to be confident that you have provided your client with the best quality contract for them. So again, this is really going to add the value in terms of your recommendation as to why you've not selected the cheapest and actually why you've recommended who you have. We then look at the amount paid and the likelihood of claiming on the contract. And again, this is a real key area. The scoring here will really show why you are recommending who you are and why you haven't recommended the cheapest contract.

So, my client had an 11-year-old son, so we've also done the analysis on children's cover, so it's always favourable to see that the statistics are much more in their favour, but we all know that children's claims happen, and this one is a really impactful and powerful slide. This is really going to show why you are not recommending the cheapest and actually why we're going a few pounds over budget, which means more commission for you as well as to why you're recommending the best contract for your client. I said yes to value added benefits. So this has been included in our analysis. Again, we'll show you what we've analysed, how it's been weighted with your overall quality score. And again, as I mentioned earlier, as you are going through this, you are writing your recommendation and putting out the features that were important to your client as to why you've recommended who you have.

We've then done the same for the product features because I wanted to look at the life cover here again, what's been analysed, how it's been weighted with the overall quality score and then a breakdown of those individual scores. Clients really do engage with those slides and as I mentioned earlier, it really does bring the policy to life. What we have also done, and again, this can be very much dependent on the client, some like the detail and some don't, but we've gone through every definition and we'll show across each three of the providers what the percentage payout is and what that means in terms of monetary value. So you can see here for carotid artery stenosis Royal London would pay out £35,000 and Scottish widows would pay £30,000. So if there is a particular condition that your client is concerned with, this will really help In terms of pulling out the importance, what we've then done is gone through every again, and if I select bacterial meningitis as an example, we will show the overall quality score for each provider on that definition and then what that definition reads.

So, as you can see there, the Royal London contract gains a hundred percent in terms of that quality for that definition where Scottish Widows and Aviva score 50% because ultimately there is criteria in terms of meeting that definition. So it could be persisting symptoms, et cetera, et cetera. But we give you all of the detail there. As I mentioned, some clients really do engage with the additional detail. Some clients just want that high level. So thank you very much for your time. I'm now going to pass back to Shelley and thank you again, Shelley, for letting me join you today.

Oh, you're welcome, Joe. Honestly, thanks so much. I'm sure our delegates today have learned so much about Protection Guru's comparison system. I know I certainly have. So thank you again for this really informative session. So this brings me to the end of our webinar today. Thank you so much for joining us and look out for our next Royal London Adviser webinar coming to you soon.