Nick Kirwan Head of Protection Product Development

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Nick KirwanHead of Protection Product
Development Marketing
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Titanic Forces
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The world we live in

• Flexible lifestyles
• Erosion of State Benefits
• Hidden erosion of company benefits
• Trend to self employed
• Job losses
• Savings gap
• The 1 trillion debt mountain

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Todays health risks

• Most Common CI Claims
• Cancer
• Heart attack
• Stroke
• Multiple sclerosis
• Heart surgery CABG, valve surgery
• Child cover
• Total permanent disability

Source Scottish Provident critical illness
claims, 2003.
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Cancer new all time high

• UK Association of Cancer Registries...
• Malignant melanoma 24 up
• Uterine cancer 22 up
• Breast cancer 12 up
• Prostate cancer 25 up
• Non-Hodgkins lymphoma 17 up
• Cervical cancer 13 down
• but survival rates are improving all the time

Source UK Association of Cancer Registries
figures published 7th Jan 2004 comparing 2000
with 1995.
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2020 Vision

• WHO predicts
• Global cancer cases could soar by 50
• Governments can
• Screen to detect cancer earlier
• To reduce the Big 3, we all can
• Stop smoking
• Eat more fruit vegetables
• Take regular exercise
• Reduce weight

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Child obesity timebomb'

• Food Standards Agency ticking timebomb
• poor nutrition
• lack of exercise
• Institute of Child Health alarming rate

Sources BBC News, 9/11/2003, 21/3/2003
11/2/2004 Obese children aged 6 to 15
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Obesity the shocking facts

• 30,000 deaths a year
• NHS costs 500 million a year
• National Health debate announced Feb 2004

Source BBC News 11/2/2004 - Obesity 1980 to 2001
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People need

• Protection
• Advice about protection
• Opportunities
• Flexible plans for flexible lifestyles
• The value of child cover
• Mortgage cover plus debts, family, pension etc
• Indexation same cost, better protection
• Buyback life goes on after a critical illness
• Unemployment cover hidden treasure

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The growth in protection
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The CI market where next?

• Reinsurance capacity
• Excellent value for money
• The cost in 2005?
• The need for flexibility
• Mind the gap!
• Critical illness Guarantees?

Example male non-smoker, 32 nb, 60,000
guaranteed rate death or earlier critical illness
with own occupation TPD
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Trends in medical science

• Health Service aims
• Prevent illness
• Earlier diagnosis
• Better treatments

• The effect on CI
• Illnesses less critical
• Ongoing change

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Angioplasty

• Then
• Invasive procedure
• Damage to arteries
• CABG after 5 years
• Start of a decline

• Now
• Day case
• Local anaesthetic
• 10 days off work
• Improvement in lifestyle

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eGPR fact or fantasy?

• Used in Doctors surgeries
• Manages appointments
• Holds patient records
• Linked to NHSnet

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eGPR how it works
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e-business the way ahead

• Whats available
• On-line training sales ideas
• On/Off-line quotes
• Pre-populate applications
• Submit online
• On-line tracking
• Benefits
• Saves time
• Extra commission

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Regulation - background

• Investments
• Existing regime
• Mortgages 31 Oct 2004
• Treasury
• Protection General Insurance 14 Jan 2005
• EU Insurance Mediation Directive (IMD)
• Passporting
• Depolarisation Autumn 2004?

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Regulation Roadmap
Your Proposition
I want to offer independent advice (with a
choice of fees or commission for mortgages
investments)
Will you be able to meet the Authorised Principal
regulatory requirements?
No
Yes
Will you be able to meet the Authorised Principal
regulatory requirements?
I want to offer products from a selection of
providers
No
I want to offer a particular providers product
portfolio
I want to introduce clients to a firm
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Protection/GI sales process

• Advised sales
• Disclosures
• Status
• Any fees (not commission)
• Policy Summary / KFD
• Price
• Policy (or specimen)
• Claims process
• Demands Needs
• Durable medium
• Pre-commitment
• Advice given
• Why suitable
• Unmet demands needs

• Non-advised sales
• Scripted questions
• Disclosures
• Status
• Any fees (not commission)
• Policy Summary / KFD
• Price
• Policy (or specimen)
• Claims process
• Demands Needs
• Durable medium
• Pre-commitment
• Unmet demands needs

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Giving advice on protection/GI

• Advice is
• The merits of buying or selling a particular
  insurance product
• Independent if
• Fair assessment of market (no need to offer a
  fee basis)
• Need not take account of
• Forgotten details of policies
• A suitable policy taking account of
• Value for money
• Insurers creditworthiness
• Insurers claims handling record

Retrospective FOS enforcement
Source CP187
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FOS the consumers teeth

• Advice issues
• Reviewable premiums?
• At claim stage
• Free cover?
• Child cover?
• CI cover (eg silent heart attacks)?
• Non-disclosure?

Up to 100,000
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Protection advice checklist

• Value for money
• Price
• Guarantees
• Cover
• Flexibility

• Financial strength
• Rating
• Claims
• Track record

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Clash of the Titans
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The way ahead

• The market is exciting
• Protection underpins all financial plans
• Advice, not price
• Flexible plans for flexible lifestyles
• Mortgage cover plus debts, family, pension etc
• Indexation same cost, better protection
• Buyback life goes on after a critical illness
• Unemployment cover hidden treasure
• Client for life
• Protects your advice

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Notes
Full details and written quotations are available
on request. Scottish Provident is the brand name
for Scottish Mutuals protection products. Phone
0131 556 9181. Web site address
www.scotprov.co.uk Scottish Mutual Assurance plc
is owned by Abbey National plc. Registered
office Abbey National House, 301 St Vincent
Street, Glasgow G2 5HN, United Kingdom. Phone
0141 248 6321. Registered in Scotland no. 133846.
Regulated by the Financial Services Authority.