Key Features of the NFU Mutual Mortgage Temporary Assurance Policy with Critical Illness Cover PROTECTION

Transcription

1 Key Features of the NFU Mutual Mortgage Temporary Assurance Policy with Critical Illness Cover PROTECTION

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3 CONTENTS 03 Who should buy this product? Its Aims Your Commitment Risks 04 What is the Mortgage Temporary Assurance Policy with Critical Illness Cover? How much does it cost? How long does the cover last? 05 How much does the policy pay out? Who can take out a policy? How do I pay premiums? What if I stop paying premiums? 06 What conditions are covered by critical illness cover? 07 When won t the policy pay out? What happens if I die during the period of cover? What happens if I m diagnosed with a critical illness during the period of cover? 08 Can I transfer ownership of my policy? How do I take out a policy? When does cover start? What is Interim Cover? How much Interim Cover is provided? When will the Interim Cover start and how long does it last? 09 What s not covered by Interim Cover? Can I use Interim Cover to cover a loan? What if I change my mortgage? What if I have a tenancy in common mortgage?

4 10 What are the charges? What about tax? Can I change my mind? How to contact us including making a claim Making a complaint 11 Other information: Law and language used Compensation About NFU Mutual Our Mutuality Your policy document The ABI Guide to Critical Illness 12 Is this product right for you?

5 WHO SHOULD BUY THIS PRODUCT? People with repayment mortgages who want financial protection if they die or suffer from a critical illness covered by this policy. ITS AIMS To pay a cash lump sum, if, during the period of cover: you die, or you re diagnosed with a critical illness covered by the policy that meets our policy definition. The policy definitions aren t related to your ability or inability to work. YOUR COMMITMENT You must: Answer all our questions truthfully, accurately and completely to the best of your knowledge when applying for (or restarting) your policy, and when making a claim. If you don t, we may not pay a claim. Tell us if there is a change to your: health family medical history occupational duties overseas travel country of residence hazardous leisure activities from the date you apply for cover (or to restart cover) until the date your policy starts (or restarts). If you don t tell us we may not pay a claim. Pay premiums by direct debit, monthly or yearly, during the period of cover. If you don t your cover may stop. Tell us about a critical illness claim within six months of being diagnosed and undergo any medical examinations and tests we ask for. If you don t we may not pay a claim. RISKS Claims You may suffer from a critical illness that isn t covered by the policy, or doesn t meet our policy definition of the illness. We won t pay a claim in certain circumstances. Please read the later section When won t the policy pay out? on page 7. If you haven t been honest or accurate in providing information at the time you apply for the cover or at the time of a claim, we may not pay a claim. Paying premiums If you stop paying premiums, or you don t pay on time, we ll cancel your policy one month after the date your payment was due and your cover will end. You ll get nothing back. Repaying your mortgage This policy may not pay off your mortgage in full if: during the period of cover your mortgage interest rate has been higher than 9% your mortgage payments aren t up to date you ve changed your mortgage and not changed your cover you take out cover for less than your mortgage. Please read the section How much does the policy pay out? for more details. About tax The tax treatment depends on the individual circumstances of each customer and may be subject to change in future. Please read the section What about tax? for more information. Key Features of the NFU Mutual Mortgage Temporary Assurance Policy with Critical Illness Cover 05

6 QUESTIONS AND ANSWERS What is the Mortgage Temporary Assurance Policy with Critical Illness Cover? It s an insurance policy that pays out a lump sum if, during the period of cover, you: How much does it cost? You pay regular premiums to keep your cover until your mortgage finishes. Your premium amount depends on: die, or are diagnosed with a critical illness that meets our policy definition and then survive for at least 30 days. We only cover the critical illnesses we define in our policy and no others. Please read the section What conditions are covered by critical illness cover? for more information. The lump sum reduces each month. The cover is intended to go down as your mortgage reduces. Please read the section How much does the policy pay out?. You can set it up with one owner or up to four joint owners. You can cover one or two lives. It has no cash in value at any time. If you haven t received an illustration, or you want an alternative personalised one, please call us on your personal circumstances, for example, your age, health, occupation and whether you smoke the amount of cover how long your mortgage term is. Your premium won t change during the period of cover. Your illustration shows how much your policy might cost. How long does the cover last? You must set the policy up so that the cover lasts until your mortgage finishes. It must be a number of whole years between 5 and 35. The period of cover must end before any person whose life is being covered reaches age 70. The policy will finish at the end of the period of cover, or when we pay a claim. 06

7 How much does the policy pay out? You would normally start the policy with cover at the same amount as your mortgage. Your mortgage amount will reduce as you make repayments to your lender. The level of cover on your policy will also reduce each month. The reduction in cover won t be based on your own mortgage interest rate it will assume a fixed mortgage interest rate of 9%. If your mortgage interest rate goes higher than 9% during the period of cover, the lump sum we pay on a claim could be less than needed to pay off your mortgage. If your mortgage interest rate is lower than 9%, the lump sum we pay on a claim could be more than needed to pay off your mortgage. The lump sum may be less than your mortgage, if: your mortgage payments aren t up to date you ve borrowed more money or extended the term and not changed your cover you take out cover for less than your mortgage. Who can take out a policy? You can take out a policy if: you have a repayment mortgage you re named on the mortgage deed you and any person whose life is covered is 18 or over any person whose life is covered is under 65. How do I pay premiums? Monthly or yearly by direct debit. If you re paying from a business account that s not solely or jointly in your name(s) we might carry out security checks to confirm where the money is coming from. We may require additional information about the business, including evidence of identity for anyone who owns a share in the business, as required under the Money Laundering Regulations. We may refuse to accept payment. What if I stop paying premiums? We ll cancel your policy one month from the date your last payment was due, and you ll get nothing back. The chart below shows how a mortgage would reduce over the mortgage term using assumed mortgage interest rates of 6%, 9% and 12%. Mortgage amount Mortgage term Key Features of the NFU Mutual Mortgage Temporary Assurance Policy with Critical Illness Cover 07

8 If you want to start paying into your policy again, you can apply to restart it within six months of when your first unpaid premium was due. You ll have to pay any premiums you ve missed and we ll charge a late payment fee of 1.5% of the amount due. We ll also ask you to provide evidence of your health. There s no guarantee we ll allow you to restart your policy. You ll need to contact us at the address given under How to contact us to ask us about restarting your policy. What conditions are covered by critical illness cover? The complete list of conditions we cover is shown later in this section. These headings are only a guide to what is covered. The full definitions of the illnesses covered and the circumstances in which you can claim are given in the policy document. These typically use medical terms to describe the illnesses but in some cases the cover may be limited. For example: some types of cancer are not covered to make a claim for some illnesses, you need to have permanent symptoms. Please let us know if you would like to see a sample copy of the policy document, see later section How to contact us. We also give the full illness definitions in our Guide to the Critical Illness Definitions provided with this Key Features Document. The critical illnesses we cover: Alzheimer s disease before age 65 resulting in permanent symptoms Aorta graft surgery for disease or trauma Benign brain tumour resulting in permanent symptoms Blindness permanent and irreversible Cancer excluding less advanced cases Coma with associated permanent symptoms Coronary artery by-pass grafts with surgery to divide the breastbone Deafness permanent and irreversible Heart attack of specified severity Heart valve replacement or repair with surgery to divide the breastbone HIV infection caught in the UK from a blood transfusion, a physical assault or at work in an eligible occupation* Kidney failure requiring permanent dialysis Loss of hands or feet permanent physical severance Loss of speech total, permanent and irreversible Major organ transplant from another person Motor neurone disease resulting in permanent symptoms Multiple sclerosis with persisting symptoms Paralysis of limbs total and irreversible Parkinson s disease resulting in permanent symptoms Stroke resulting in permanent symptoms Terminal illness where death is expected within 12 months Third degree burns covering 20% of the body s surface area Total permanent disability unable to look after yourself ever again Traumatic brain injury resulting in permanent symptoms. *The eligible occupations for HIV caught at work are: the emergency services police, fire, ambulance the medical profession including administrators, cleaners, dentists, doctors, nurses and porters the armed forces. 08

9 When won t the policy pay out? For life cover or critical illness cover We won t pay a claim for life or critical illness cover, and may cancel your policy, if: you don t answer all our questions truthfully, accurately and completely to the best of your knowledge and provide any information we ask for when applying for (or restarting) your policy, and when making a claim. you don t tell us about any of the following changes that happen between applying for (or restarting) your policy and when it starts (or restarts). Changes to your: health family medical history occupational duties overseas travel country of residence hazardous leisure activities. For life cover We won t pay a claim for life cover if your death is due to suicide and this happens during the policy s first year, or within the first year after you ve restarted it. Please refer back to the section What if I stop paying premiums? for information on restarting. The suicide exclusion won t apply in the conditions explained in the later section Can I transfer ownership of my policy?. For critical illness cover We won t pay a claim for critical illness cover if: You have an illness that does not meet our definition of one of the critical illnesses we cover. For example, some types of cancer aren t covered. Your claim results from alcohol or drug abuse, criminal acts, flying, hazardous sports and pastimes, self-inflicted injury, unreasonable failure to follow medical advice or war and civil commotion. Your claim is for cancer that s diagnosed within the first 90 days of the policy. You don t make the claim within six months of diagnosis of a critical illness. Your claim results from something that we specifically tell you we won t cover when we accept your application. We ll tell you about these before your cover starts and show them in the schedule that s part of your policy document. Full details of what s covered and any standard items that aren t covered are set out in clauses 2, 3, 8 and 13 of your policy document. You can ask us for a sample copy of this, see How to contact us. What happens if I die during the period of cover? We ll pay the death benefit to the legal owner of the policy. If it s set up to cover someone else s life, we ll pay the death benefit when that person dies. If it s set up to cover two lives, it will pay on the first death. Your policy will end when we pay a death claim. What happens if I m diagnosed with a critical illness during the period of cover? If you re diagnosed with a condition that you think is covered by the policy you must tell us within six months of your diagnosis. We will only pay a critical illness claim if you survive for at least 30 days after being diagnosed. You must keep paying premiums until we tell you of our decision about your claim. We may ask you to have a medical examination or provide medical evidence. If your policy s set up to cover someone else s life, it will pay when that person is diagnosed with a critical illness that meets the policy definition. Key Features of the NFU Mutual Mortgage Temporary Assurance Policy with Critical Illness Cover 09

10 If your policy s set up to cover two people, it will pay when the first person is diagnosed with a critical illness that meets the policy definition. Your policy will end when we pay a critical illness claim. It won t pay out again. Can I transfer ownership of my policy? You can transfer ownership to another person or company. In legal terms this is known as an assignment. If you do this please let us know, so that we know who is legally entitled to the benefits. If your policy has been assigned we would pay a life cover claim if death is due to suicide in the first year (or within one year after restarting the policy) unless you assigned the policy as a gift. How do I take out a policy? You (and any person to be covered) must fill in an application form. We may request medical evidence of health for any person to be covered/or other additional information. When we ve considered your application, we ll let you know: if we ll accept your application without making any changes to the policy if you need to pay a higher premium than the one shown in your illustration if we need to restrict your cover if we won t accept your application. When does cover start? Your policy will start once we ve accepted your application and you ve agreed the premium and any special terms or conditions. If you re a UK resident and under age 60 when your application and direct debit forms are completed and signed we ll give you Interim Cover. If the policy covers two lives, both must be under age 60 for Interim Cover to apply. What is Interim Cover? It s a temporary arrangement that ll provide cover if you die while we re processing your application. It doesn t provide cover for diagnosis of a critical illness. How much Interim Cover is provided? Under Interim Cover we ll pay the lower of: the amount of cover you ve requested in your application, or 300,000. When will the Interim Cover start and how long does it last? It will start on the date of your signed application and direct debit form. It will stop on the earlier of: 90 days from the date you signed your application the day before your policy documents are issued if we don t receive medical information we ve asked for, four weeks from the date we requested it the date you withdraw your application, if you decide you no longer wish to proceed with it the date we tell you that your application is being turned down or delayed by us. We may delay your application if we re unable to make a decision until a future event has happened. For example, we may want to delay our decision until you ve had medical treatment. 10

11 What s not covered by Interim Cover? We won t pay an Interim Cover claim if it s as a result of: or related to a condition where you received treatment, advice or counselling from a medical practitioner at any time or related to a condition or symptoms you should have been aware of at the time of the application but for which you hadn t sought treatment, advice or counselling from a medical practitioner suicide or intentional self-inflicted injury alcohol abuse or the misuse of drugs taking part in any flying activity other than as a passenger in a commercially licensed aircraft taking part in or practising for boxing, bungee-jumping, caving, climbing with ropes, horse-racing, contact martial arts, mountaineering, off-piste skiing, potholing, powerboat racing, yacht racing or any race, trial or timed motor sport. Also, we won t pay an Interim Cover claim if: you ve applied for other life insurance cover to us or to any other life company within 90 days of the date of your application for our Mortgage Temporary Assurance Policy with Critical Illness Cover you don t give us all the information we ask for in the application form we discover that information given in the application form is untrue, inaccurate or incomplete (even if it doesn t relate to the cause of the Interim Cover claim) when you completed your application, you were living outside of the UK or you were living temporarily in the UK but normally live outside of the UK you die outside the Interim Cover period. Can I use Interim Cover to cover a loan? We don t recommend that you use Interim Cover for this purpose. Interim Cover is short-term cover and may be withdrawn as already explained. By providing Interim Cover, we re giving no commitment about the terms, if any, on which we may offer to insure you under this policy, or any other policy. What if I change my mortgage? If you move house and take out a new repayment mortgage, increase your mortgage or extend its term, you may be able to cancel your policy and take out a new one without having to provide further medical evidence. This option will only be available if we are still offering the same type of policy. The new policy would be on our terms and conditions and premium rates applying at that time. There are various limits, depending upon such things as your age, the remaining mortgage term and the amount of cover you need. These are explained in clauses 10 and 11 of your policy document. What if I have a tenancy in common mortgage? A tenancy in common mortgage involves you and at least one other person taking out a mortgage but where each of you is only responsible for your share of the amount borrowed. You have two choices: You can apply for cover to protect only your share of the repayment mortgage if you die, or are diagnosed with a critical illness, during the period of cover. Your cover should start at the same amount as your share of the mortgage. The cover will decrease each month, as previously explained under How much does the policy pay out?. The policy won t pay out any amount that you re jointly responsible for with any other person or as guarantor. You can take out cover for a tenancy in common mortgage, jointly with the other borrower or borrowers, for the whole amount of the repayment mortgage. Key Features of the NFU Mutual Mortgage Temporary Assurance Policy with Critical Illness Cover 11

12 The policy will pay out the whole amount covered on the death of the first to die or on the first diagnosis of a critical illness. You will need to agree with the other borrower or borrowers how any proceeds of the policy will be dealt with. What are the charges? Your illustration shows how much it will cost to get the cover you want. This cost reflects any charges we may make to cover the costs of setting up and managing your policy, including any commission, remuneration or initial advice charges. What about tax? The tax treatment depends on your individual circumstances. It may change in future. Under current tax rules you won t have to pay UK income tax or capital gains tax on any lump sum paid from your policy. The policy s death benefit will form part of your estate for inheritance tax purposes. You can use a trust to help with inheritance tax planning. Ask your NFU Mutual Financial Adviser for more details. Can I change my mind? You ll have 30 days to change your mind about your Mortgage Temporary Assurance Policy with Critical Illness Cover. We ll write and tell you when the 30 days starts. You can cancel within the 30 days and have your money back. If you change your mind, write to us at the address given under How to contact us. If you don t cancel within the 30 days, your policy will continue as set out in these key features and your policy document. You should remember that your policy has no cash in value at any time. How to contact us including making a claim If you want to: cancel your policy change your policy cover (if your mortgage changes) make a claim transfer ownership of your policy ask any other questions ( call us on Our telephone lines are open on weekdays from 8.30am to 6.00pm. We may record telephone calls for training, monitoring or security purposes. Or * write to us at: NFU Mutual Life Services Tiddington Road Stratford upon Avon Warwickshire CV37 7BJ Making a complaint If you need to make a complaint, please write to us or call us on , as indicated above, and we will do all we can to resolve the complaint to your satisfaction. If you re not satisfied with our response to a complaint, you can contact: The Financial Ombudsman Service (FOS) Exchange Tower London E14 9SR Making a complaint won t affect your legal rights. 12

13 OTHER INFORMATION Law and language used Under English law, people making contracts can choose which law applies. The law of England will apply to this Mortgage Temporary Assurance Policy with Critical Illness Cover, unless you ve agreed otherwise with us before it starts. Your policy and all our other communications with you will be in English. Compensation If NFU Mutual is unable to pay claims because of financial difficulties, you may qualify for compensation from the Financial Services Compensation Scheme. You can contact the Financial Services Compensation Scheme for further details, on or , or About NFU Mutual NFU Mutual is The National Farmers Union Mutual Insurance Society Limited. It s a registered company that s limited by guarantee, which means its capital isn t divided into shares. Its Head Office is in the United Kingdom of Great Britain and Northern Ireland, situated at: Tiddington Road Stratford upon Avon Warwickshire CV37 7BJ NFU Mutual s main business is providing financial services and general insurance. It s authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, and is on the Financial Services Register under number You can contact the Financial Conduct Authority as follows: ( Consumer helpline: * 25 The North Colonnade Canary Wharf London E14 5HS consumer.queries@fca.org.uk Our Mutuality We are a Mutual company, which means we have no shareholders. We aim to pass on the benefits of mutuality to our financial services customers by low charges and personalised service. In the unlikely event of de-mutualisation, any windfall payment arising from the policy you re taking out would be paid to The NFU Mutual Charitable Trust, instead of to you. Your policy document This key features document gives you a brief explanation of the most important features of the Mortgage Temporary Assurance Policy with Critical Illness Cover. It s based on our understanding of current law and tax practices, which can change. It complies with the Association of British Insurers (ABI) Statement of Best Practice for Critical Illness Cover The full terms and conditions are in the policy document. If you d like a copy of this, please ask your NFU Mutual Financial Adviser, or contact us as explained under How to contact us. We ll always send you a copy of this when we ve set up your policy. The ABI Guide to Critical Illness The ABI give general information about critical illness in their information sheet ABI Guide to Critical Illness. You can ask us for a copy or you can get a copy at: Products/Life-cover/Critical-illnessinsurance or by writing to: The Association of British Insurers 51 Gresham Street London EC2V 7HQ Key Features of the NFU Mutual Mortgage Temporary Assurance Policy with Critical Illness Cover 13

14 Is this product right for you? If you re unsure about whether this product is right for you please speak with your NFU Mutual Financial Adviser or call one of our Telephone Financial Advisers on NFU Mutual Financial Advisers advise on NFU Mutual products and selected products from specialist providers. We ll explain the advice services we offer and our charges. 14 KFD/MTC/011215

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16 nfumutual.co.uk NFU Mutual is The National Farmers Union Mutual Insurance Society Limited (No ). Registered in England. Registered office: Tiddington Road, Stratford upon Avon, Warwickshire CV37 7BJ. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. A member of the Association of British Insurers. For security and training purposes, telephone calls may be recorded and monitored. KFD/MTC/