Norwich Union announced today that it is changing the premiums on its term assurance and term assurance with critical illness (CI) policies with effect from 16 June 2003.
Norwich Union announced today that it is changing the premiums on its term assurance and term assurance with critical illness (CI) policies with effect from 16 June 2003. As a result of an increase in reinsurance rates new policy premiums for term assurance will rise by an average of 5% and premiums for term assurance with CI will rise by an average of 18%. Existing policies already in force are not affected by these changes.
Willie Mowatt, director of product development at Norwich Union, said: “These premium rises reflect the increase in the cost of reinsurance. To enable Norwich Union to continue to offer guaranteed premium critical illness policies we need to adjust the prices. We have not increased term assurance premiums for two years and have held these premiums for as long as possible in the current climate.
Currently, the critical illness market is extremely competitive and we are seeing much turbulence in its pricing. Existing applications from customers will be honoured at the quoted premium rates.”
All IFAs and introducers are being notified today regarding the changes.
Norwich Union will honour quotes at current rates, subject to normal underwriting, provided the proposal and a valid quote* are received by Norwich Union by 15 July 2003.
Example premiums:
Male, non smoker, age 35 next birthday, 25 year term,
sum assured Ł50,000
| Pre 16 June | Post 16 June | |
| Term assurance with critical illness | Ł22.20 | Ł26.25 |
Female, non smoker, age 35 next birthday, 25 year term,
sum assured Ł50,000
| Pre 16 June | Post 16 June | |
| Term assurance with critical illness | Ł20.05 | Ł23.00 |
Male, non smoker, age 40 next birthday, 20 year term,
sum assured Ł50,000
| Pre 16 June | Post 16 June | |
| Term assurance | Ł8.15 | Ł8.55 |
Ends
Press office contacts:
| Out of hours | ||
| James Evans | 08703 66 68 78 | 07790 487105 |
| Lorna Wiltshire | 08703 66 68 78 | 07788 471849 |
| Louise Goffee | 08703 66 68 70 | 07810 057362 |
| Ian Beggs | 08703 66 68 71 | 07790 487533 |
Notes to editors:
Norwich Union is the UK’s largest insurer. It is a leading provider of life, pensions and investment products and one of the leading IFA providers. IFAs provide around 70% of the company’s long-term savings business.
Norwich Union has strategic alliances with building societies and other leading UK brand names including Tesco Personal Finance and The Royal Bank of Scotland Group.
Norwich Union’s news releases and a selection of images are available from Aviva's internet press centre at www.aviva.com/media.
The average increases quoted depend on the age, sum assured and other relevant underwriting criteria. Term assurance with critical illness premium rates were last increased on 9 December 2002. Rates for Mortgage life insurance (MLI), MLI with CI and stand alone CI will not be affected. Proposals submitted to Norwich Union before the 15 June will not be affected.
Guaranteed critical illness : Guaranteed rates for critical illness are rates that do not change for the term of the critical illness contract. This is different to renewable rates that can be reviewed after the critical illness policy has been taken out.
Reinsurer: Reinsurers are third parties to whom insurance companies sub-contract part of an insurance risk, or an entire book of business. This risk can include both capital and mortality/morbidity.
* Valid quote: A quote dated from 17 May 2003 until 15 June 2003 must be submitted to, and received by, Norwich Union with the application form by the 15 July 2003 to obtain the current rates.