We believe that Indexation is important in order to protect the value of cover for clients. This is particularly clear considering the expected increase in inflationary pressures in the UK market today, driven by the weakening value of the pound.

Despite this, Indexation remains an undersold benefit in the market. We believe this is partly because clients don’t fully consider the need to protect cover against the effects of inflation, or appreciate the value of this.

We’ve received feedback about our Indexation option and we’ve listened to what’s been said. So in order to encourage greater consideration of Indexation we have made the changes listed below to provide greater flexibility and simplicity to clients.

  • The removal of Indexation will have no premium impact
  • Indexation can be declined twice in a row. On the third consecutive decline of Indexation, the option will be removed
  • Policies and covers with Indexation will have lower initial premiums than level policies and covers

When did these changes come into effect?

These changes are now live.

Will these changes affect quotes already in the pipeline?

Policies in pipeline will continue to be indexed according to the old Indexation rules. Only new business quoted on or after 13th May 2017 will receive the new Indexation rules. If you would like the new Indexation rules to apply, you should re-quote pipeline business.

What covers does it apply to?

This change applies to all cover types with Indexation under the following plan types:

  • VitalityLife Plan
  • VitalityLife Essentials Plan
  • Relevant Life Plan
  • Business Protection Plan

The change will apply to all benefits which have the Indexation option available.

Indexation commission

The commission boost will remain the same. That is, for indexed policies, there is a boost to initial commission in a similar manner to Wellness Optimiser or Vitality Optimiser. Initial commission is boosted by 10% for standard policies and 15% for optimised policies, applied to the LAUTRO rate. As with Wellness Optimiser or Vitality Optimiser, no ongoing initial commission will be payable at each anniversary

How will this affect how quotes are displayed on the portals?

There will be no change to how indexed quotes are displayed. All level quotes will return both a level and indexed quote, for both Term and Whole of Life products.

To help you understand further understand the changes made to our Indexation option, we’ve produced an FAQ which can be found here.

We’re also launched an adviser and client campaign which coincides with the improvements we are making to our Indexation offering. As part of the campaign we are running a special offer for clients and advisers, as detailed below. This campaign runs until the end of June.

Advisers
We’ve made it even better for advisers who take out their own VitalityLife indexed policy, we’re offering two months free plus up to £100 additional cashback on all indexed policies with one of the following: Wellness Optimiser, Vitality Optimiser, Interest Rate Optimiser or Premium Rate Optimiser.

Terms and conditions apply

Clients
Up to two months free cover when you get healthy. One month free in the first year and one month free on anniversary if Silver status is reached in the first year. Available on all indexed policies with one of the following: Wellness Optimiser, Vitality Optimiser, Interest Rate Optimiser or Premium Rate Optimiser.

Terms and conditions apply
A number of materials have also undergone changes or are brand new:

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