Cirencester Friendly has broadened its insurance offerings by introducing a short-term benefit option to its award-winning My Earnings Protected income protection product.
The new provision provides coverage for up to two years per claim, offering members an economical means to safeguard their household bills against loss of income due to illness or injury.
The product expansion responds to growing demand from consumers and advisors alike. The 2021 Swiss Re data indicates that the majority of individual income protection sales are now for limited term coverage, with a two-year cover period being the most favoured choice.
My Earnings Protected, designed for flexibility and affordability, has expanded to offer a short-term benefit, bringing income protection within reach for all. The offering includes deferred periods ranging from one to 52 weeks, cover up to the age of 70, and a maximum benefit of 65% of income capped at £52,000 annually. Consistent with all Cirencester Friendly products, no extra charges are applied for occupation, smoking habits or hazardous pursuits, excluding motor sports.
The processes for sales and underwriting remain unchanged, and there is no compromise on the scope of support services available. The short-term option comes with a range of additional benefits such as fracture and hospitalisation coverage, mental health support via Friendly Voice, and GP24.
With about 90,000 individuals taking a career break annually for a variety of reasons, Cirencester Friendly recognises the need for flexible coverage. Hence, members can temporarily suspend their coverage for up to 12 months if needed.
To put the affordability into perspective, coverage of £1,000 per month for a 30-year-old, with a guaranteed level premium and a 13-week deferred period, costs £10.25 a month, less than the average weekly latte expenditure.
The Society has taken the fluctuating nature of individual health into consideration. Individuals prone to relapses from serious illnesses or injuries can make claims for the same condition within 26 weeks, and payments will be processed without a deferred period. However, the maximum claim period for one illness remains limited to two years.
Alan Waddington, distribution director at Cirencester Friendly, said: “As an organisation, we aim to be seen as champions of income protection, striving to make it more accessible and affordable. The short-term benefit option is an exciting step forward, helping people protect their livelihoods, especially during these challenging economic times.”
Matt Chapman, TheProtectionCoach, added: “The big challenge with the current economic climate is that it increases the need for essential financial protection whilst simultaneously making cover significantly less affordable for the average consumer. In an ideal world, everyone would take full-term income protection cover but this just isn’t realistic at this time.
“The new short-term option from Cirencester retains all of the key benefits and advantages of their full-term offering but at a fraction of the cost, making essential income protection (and the financial resilience and security these plans deliver) a more accessible and affordable consideration for UK households.”
