AIA Australia (AIA) has released details of its annual product upgrade, the new PDS to take effect from 1 December 2009.
There have been key enhancements introduced that apply to new and existing clients and there are also new features and benefits that will only apply to clients taking out cover from 1 December through the new PDS (version 8 in the current Priority Protection series).
In a communication to advisers, AIA highlights the following key enhancements for all clients:
Life Cover Plan
- Up to $25,000 payment under Final Expenses benefit if the owner of the policy is a company or business entity (previous benefit was up to $10,000 for all claimants).
Income Protection Severity Benefit
- Pays an additional 1/3 of the Insured Monthly Benefit per month if the life insured is diagnosed as totally and permanently disabled to the extent that the life insured is unable to do two of the Activities of Daily Living.
- AIA emphasises that with this additional payment, the Income Protection benefit will be paying up to 100% replacement ratio of the life insured’s income.
Income Protection Day 1 Accident Benefit
- Enhanced to include additional payment periods of 60 and 90 days.
Other key enhancements include:
TPD & TPD Stand Alone
- The period of unemployment immediately prior to a claim is now unlimited for the ‘Own Occupation’ definition
Income Protection
- The definition for pre-disability income (Indemnity) is the greater of the life insured’s average monthly income:
- for the 12 consecutive months preceding the commencement of disablement; and
- the latest financial year preceding the commencement of disablement
(Previously, only the latest financial year clause applied)
- Severity Benefit now pays an additional 1/3 of the Insured Monthly Benefit (maximum of $30,000 per month) if the life insured is totally disabled to the extent that he/she is unable to perform at least two of the Activities of Daily Living
Crisis Recovery & Crisis Recovery Stand Alone
- Introduction of a ‘Complimentary Child Crisis Recovery’ benefit to all Crisis Recovery and Crisis Recovery Stand Alone policies under the Comprehensive option, which will provide $20,000 sum insured to each child of the policy owner when the child suffers a listed crisis event.
- Definition enhancements to Major Organ Transplant, Benign Brain Tumour, Coma, Rheumatoid Arthritis
For new clients from 1 December:
- Maximum entry ages, cover ceasing ages and sums insured for certain occupation categories across various lump sum benefits have increased
- A universal level premium will apply, irrespective of gender, age or smoking status from age 16 through to expiry at age 99. This replaces the stepped
premium, based on age. - C-class occupations will now qualify for Own Occupation definition under TPD, TPD Stand Alone and Waiver of Premium benefits
- For Female Crisis Assistance, the cover options have been expanded to a choice of one of the following sums insured per listed crisis event:
- $25,000
- $50,000
- $75,000
- $100,000
- The Income Protection ‘Day 1 Accident’ benefit has been enhanced to allow the benefit to be payable for up to 90 days of total disablement due to an accidental injury
Two new benefits have been introduced:
- Complimentary Interim Accidental Crisis Cover will pay a lump sum equal to the lesser of the proposed sum insured and $1 million in the event the life insured suffers a listed accidental crisis event (under Crisis Recovery & Crisis Recovery Stand Alone)
- Incorporated Business Expenses: A business expenses policy owned by a company or business entity on the life of a business owner or partner. This benefit will pay an Agreed Value for the first 12 months of claim and Indemnity Value for a further period of 12 months.
AIA emphasises that there have been no rates increases as a result of these enhancements.
Advisers can access the new PDS from the riskinfo Resource Centre from 1 December 2009.
