Norwich Union reviews critical illness

Article date: 11 August 2003

Norwich Union is launching a reviewable premium critical illnessproduct with guaranteed policy definitions on Monday 18 August2003. Premiums on the new critical illness product will be reviewedevery five years on the policy’s anniversary.

In addition, premiums for term assurance with the option ofguaranteed critical illness and mortgage life insurance (MLI) withthe option of guaranteed critical illness will be increased witheffect from 18 August.

Summary of changes

  • Standalone critical illness policies will be available onreviewable rates only from 18 August.
  • Norwich Union continues to offer guaranteed rates whencritical illness is chosen as an option with term assurance ormortgage life insurance.
  • Premiums will increase on mortgage life insurance with aguaranteed critical illness option by an average of 12%.
  • Premiums will increase on term assurance with a guaranteedcritical illness option by an average of 1%.
  • Products sold without a critical illness option are notaffected and no price increases apply.

The critical illness offering from Norwich Union will beenhanced by the addition of free childrens critical illness cover.All natural, step or legally adopted children up to age 18 will becovered on an adult’s policy. The childrens critical illnesscover is free and provides a sum assured of £10,000 or 50% of thecritical illness sum assured, whichever is lower, for each child onthe adult’s policy.

Lawrence Jackson, head of protection product development atNorwich Union said, “The protection market is constantlychanging and we have seen the cost of guaranteed critical illnesscover rise in line with greater life expectancy and medicaladvances. It is therefore
important that we are able to offer an alternative and affordablepremium choice to the customer. The Norwich Union premiums for termassurance with reviewable premium critical illness are on average18% cheaper than our guaranteed critical illness rates.

“An important point to note is that at review, premiumsmay increase or decrease depending on a number of factors, inparticular expectation of future claims, industry experience andimpact of medical advances. However, one thing that won’tchange is the policy definitions, these will be guaranteed. Thiswill give our customers affordable cover with the peace of mindthat the policy definitions will not change in thefuture.”

Example premiums

Male, smoker, age 40 next birthday, 10 year term, sum assured£175,000:

Term assurance with guaranteed critical
Pre 18 Aug
Post 18 Aug
Term assurance with reviewable critical


Joint Life, non-smokers, both aged 35 next birthday, 25 yearterm, sum assured £100,000:

Mortgage life insurance with guaranteed
critical illness
Pre 18 Aug
Post 18 Aug
Mortgage life insurance with reviewable
critical illness


Applications on current terms for standalone critical illness atguaranteed rates, mortgage life insurance with critical illness andterm assurance with critical illness will be honoured subject tonormal underwriting, provided the proposal and a valid quote* arereceived by Norwich Union by the 16 September 2003.


Press officecontacts:Out of hours
James Evans08703 66 68 7807790 487105
Ian Beggs08703 66 68 7107790 487533
Lorna Wiltshire08703 66 68 7807788 471849
Louise Goffee08703 66 68 7007810 057362


Notes to Editors

Norwich Union is the UK’s largest insurer. It is a leadingprovider of life, pensions and investment products and one of theleading IFA providers. IFAs provide around 70% of thecompany’s long-term savings business.

Norwich Union has strategic alliances with building societiesand other leading UK brand names including Tesco Personal Financeand The Royal Bank of Scotland Group.

Norwich Union’s news releases and a selection of imagesare available from Aviva's internet press centre at

  • The cost of cover and the average increases quoted depend onthe age, sum assured and other relevant underwritingcriteria.
  • Term assurance with critical illness premium rates were lastincreased on 9 June 2003. Mortgage life insurance with criticalillness premiums were last increased on 9 December 2002.
  • The Norwich Union premiums for term assurance with reviewablecritical illness are on average 18% cheaper than our guaranteedcritical illness rates and on average premiums are 15% cheaper formortgage life insurance with reviewable critical illness.
  • Proposals submitted to Norwich Union before the 17 August willnot be affected.

Guaranteed critical illness: Guaranteed ratesfor critical illness are premiums that do not change for the termof the critical illness contract. This is different to reviewablerates that can be reviewed after the critical illness policy hasbeen taken out (every 5 years).

* Valid quote: We will honour applications oncurrent rates received by 16 September provided the application isaccompanied by a valid quote. This is a quote dated from 18 July2003 until 17 August 2003 which must be submitted to, and receivedby, Norwich Union with the application form by the 16 September2003 to obtain the current rates for Term plus CI/MLI plus CI andguaranteed rates for standalone CI.

Back to top