Momentum ticks all the boxes with their newly launched income protection benefits
Neill Müller, Head of Retail Life Insurance Product Development at MMI Holdings.
“The recent tax changes to the income disability benefits and evolving client needs provided an ideal opportunity to demonstrate our flexibility to adapt to legislative changes and in the process apply our innovative nature in designing new benefits.” This is according to Neill Müller, Head of Retail Life Insurance Product Development at MMI Holdings.
He added that “Momentum Myriad has always been the leader in the individual income disability market. This is because we understand that clients have different needs hence we embrace a ‘building block’ approach as opposed to a ‘one size fits all’ risk solution. Our existing income protection solutions incorporate the best of sickness and loss of income benefits as well as additional claim categories, such as functional impairment, critical illness and hospitalisation and fractures; ensuring the most robust claim definitions in the market.
The aim of the new income protection benefits is to complement the existing solutions from being the most comprehensive in the market to offering clients the most complete ‘needs-based’ range of income protection benefits in the market.” The newly launched benefits and features include:
• Income Enhancer Benefit;
• Complete Family Protector Benefit;
• Complete Functional Protector Benefit;
• Annual Income Commutation Option;
• Business Protector (Self Employed);
• Group Income Top-up Benefit;
• Temporary Group Income Top-up Benefit; and
• Longevity Protector™- Group Income Top-up Benefit
Launched during Momentum’s annual DNA of Financial Wellness Partnership Forums, aimed at financial advisers and currently underway across the country, “Müller stated that “These new income protection benefits will set the bar even higher in the industry by offering clients the very best choices when it comes to protecting their income and this is why:
Income enhancer benefit
This ancillary benefit provides clients with 50 per cent more cover for the first few months following a serious claim event. There are normally more unplanned expenses during this period. This could include anything from appointing an au pair to look after the children, cover rehabilitation expenses linked to a client’s injury or fund any other medical expenses or lifestyle adjustments that have to be made.
Available to both new and existing clients, this ancillary benefit can be linked to a number of current income protection benefits.
Complete family protector benefit
This new benefit acknowledges that additional expenses are often incurred when a family member passes away, is diagnosed with a critical illness or hospitalised. Such an event often necessitates a breadwinner to take time off from work to support his or her family, which might lead to loss of income. The Complete Family Protector Benefit therefore provides the following lump sum pay-outs based on the monthly benefit amount of the income protection benefit to which it is attached:
• Three times the monthly benefit amount in the event that the insured life, spouse or kids passes away.
• Three times the monthly benefit amount in the event that the insured life’s spouse or kids are diagnosed with a critical illness.
• Fifty per cent of the monthly benefit amount in the event of the insured life, spouse or kids are hospitalised for at least seven consecutive days.
Complete functional protector benefit
Whereas the existing Functional Protector Benefit only covers severe impairment events at a 100 per cent pay-out level, the Complete Functional Protector Benefit covers a wider range of impairment events and provides for tiered pay-outs ranging from 25 to 100 per cent. This is a new benefit that is available to new business submissions.
It is however important to note that these benefits are not designed to replace an individual’s income, but rather to cover additional ongoing expenses as a result of a permanent impairment. Costs associated with living with impairment can for example include hiring a nurse or covering the cost of frail care.
What makes this benefit unique is that cover is provided for ‘whole of life’ and once an insured life qualifies for a pay-out, the monthly payments are made for the rest of his or her life. In addition, clients with lump sum or income disability benefits are able to convert their cover to a Functional Protector Benefit and hereby enjoy “whole of life” impairment cover.
Annual income commutation option
The recent changes in tax paved the way for this feature which allows clients who are permanently disabled to commute their monthly income disability pay-out to an annual lump sum payment.
With this new feature, Momentum Myriad acknowledges that there is always a cash flow need associated with expenses as a result of a disability and this benefit aims to address that need. The Annual Income Commutation Option provides clients with the opportunity to make provision for more pay-out flexibility. Clients thus have the option from the second claim anniversary onwards, and after permanency have been established, to annually commute 25, 50, 75 or 100 per cent of their monthly income protection payments to a lump sum.
Business protector benefit for professionals
We enhanced our current Business Protector Benefit, only available to professionals, to include a 12 month pay-out option. One of the reasons for this includes the fact that the need to cover business expenses seldom exceed one year. We did however rename this benefit and now refer to it as our Business Protector Benefit (Professional).
Business protector benefit self-employed individuals
At the same time we created the Business Protector Benefit (self-employed) which provides income protection and business overhead protection, rolled into one, to any self-employed individual.
This benefit is unique and is a simple and efficient way of protecting your business in the event of a disability. Clients can cover up to 100 per cent of their business’ gross profit (i.e. turnover less cost of sales), ensuring that they are able to cover their business expenses and their own salary in the event of a disability.
Group income top-up benefit
Salaried employees, who are covered under group income protection arrangements, are often not able to enjoy the comprehensive cover available under individually purchased arrangements. For example, if the selected pensionable salary, on which group income cover is often calculated, does not equal a client’s total cost to company, the client will not be fully covered in the event of a disability. Secondly, if the group income cover has a three month or longer waiting period, there could be a “gap” in cover if a client runs out of sick leave before the waiting period is reached.
Our Group Income Top-up Benefit is tailor made to addresses this pressing need for employed individuals and provides for an income pay-out during the group income waiting period. In addition, this benefit ensures that clients receive a benefit based on their cost to company salary regardless of what their group arrangement covers. This is achieved by topping up the group income pay-out.
Longevity protector - Group income top-up benefit
Our unique longevity protectors already shield clients against the risk of outliving their capital. To ensure that we offer employed individuals the same level of protection, we enhanced our existing Longevity Protector – Income Protector Benefit. As a result it includes an option that will provide employed individuals access to the same level of cover against longevity even though their primary income protection is based on their group income disability.
Neill concludes by saying that “With income protection as only one of the dimensions of financial wellness, staying on course to make clients’ dreams a reality demands lot of planning and discipline. The new and existing income protection solutions assist clients to see the bigger picture of how best to reach their planned state of Financial Wellness.”
