Life/risk advisers on notice over COVID-19

24 March 2020

Advisers representing health professionals and anyone else impacted by the COVID-19 pandemic will find it difficult to move their clients to new insurers.

In the aftermath of ClearView repricing its income protection products and ending agreed-value arrangements, other insurers are making clear that the middle of the COVID-19 pandemic is not an ideal time to seek to switch clients to new underwriting arrangements.

The message from major insurer TAL is that it is not impossible to obtain cover, but tight rules are being applied which essentially preclude people who have been exposed to COVID-19 or are exhibiting symptoms suggesting they may have become infected.

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In a note to advisers, TAL has spelled out that clients purchasing TAL policies will be covered in line with their policy and individual underwriting terms but then notes: “If during the underwriting process it has been determined that customers have recently travelled abroad, or are showing symptoms of COVID-19, or are in high-risk groups, then they will be individually assessed, and individual underwriting terms may be offered. These matters would be identified and assessed through our normal underwriting process”.

The TAL note to advisers also stated: “Where an applicant is currently suffering from flu-like symptoms or a confirmed case of COVID-19, we will be unable to provide cover until they have recovered. Where an applicant is planning to travel, we will not be able to issue cover”.

TAL chief executive, Brett Clarke told Money Management that TAL’s approach was consistent with that being adopted by the other insurers and the Life Insurance Code of Conduct.

A check by Money Management revealed that Zurich Life had stated that, for policies obtained through an adviser, clients might be asked some additional travel and exposure questions during their application.

“Depending on your response, your application may be referred for further assessment. You may be asked to provide further information or have cover deferred until you have returned from overseas and/or are cleared of any symptoms,” it said.

Similarly, MLC Life’s approach states: “If you have been diagnosed with COVID-19 / Coronavirus and have been advised to self-isolate, you won’t be given cover until medically cleared. “If you have been treated and discharged and given a medical all-clear, all standard benefits will apply”.

The MLC Life approach states: “New customers will not receive cover if they have been in contact with:

  • Someone diagnosed with COVID-19 / coronavirus;
  • In contact with someone in quarantine; or
  • In contact with someone who has been in self-isolation”

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Hi Mike - check with Care Super as to whether they have an exclusion for Pandemic in relation to death or disability claims - I believe they do as it came through on an IRESS report I ran yesterday.

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