2008
(03/03/2008) AXA uses expert knowledge base to revamp protection pricing structure
AXA has overhauled its pricing structure for protection products to make it even more competitive for larger sums assured.
The new structure reflects:
- The mortality awareness data of AXA and its reinsurers
- AXA’s innovative underwriting processes and continuous underwriting development
- Four years worth of customer information and experience
- This wealth of knowledge lends itself to making AXA’s pricing even more competitive, the latest changes affecting Life and Critical Illness protection products.
Iain Mallon, Director of Protection Marketing at AXA, said: “We have strengthened our protection offering through innovative underwriting over the past four years. The higher levels of disclosure we are getting from our customers allow us to understand our risk profile more precisely.”
Iain continued: “Consumers have differing lifestyles and wealth and as people are taking out larger mortgages, the amount of cover they request is also rising rapidly. At AXA we have a dedicated large case team dealing with higher sums assured, ,making the application process as simple and straightforward as possible for advisers and their customers.”
To coincide with the introduction of the new pricing structure, AXA has revised its rates for its range of Life and CI protection products: Level and decreasing Life Cover; Level and decreasing guaranteed Life or Earlier Critical Illness Cover; and Level and decreasing reviewable Life or Earlier Critical Illness Cover.
Of those covers changing, approximately 60 per cent of premiums have reduced in price, with an average reduction of nine per cent. AXA believes these new rates will be amongst the most competitive in the market.
The examples below show some of the reductions to rates. In some situations premiums may stay the same or increase.
| Cover Description | AXA Old Monthly Premiums | AXA New Monthly Premiums | % Change |
|---|---|---|---|
| Level Life Cover | |||
| Male, 35, Non-smoker, Guaranteed premiums, Term 35 years | £24.88 | £14.71 | -41% |
| Male, 30, Smoker, Guaranteed premiums, Term 30 years | £24.93 | £14.82 | -41% |
| Joint Life, Both 20, Non-smokers, Guaranteed premiums, Term 25 years | £9.37 | £7.72 | -18% |
| Decreasing Life Cover | |||
| Female, 45, Smoker, Guaranteed premiums, Term 20 years | £21.60 | £19.04 | -12% |
| Joint Life, Both 20, Non-smokers, Guaranteed premiums, Term 15 years | £7.60 | £6.48 | -15% |
| Joint Life, Male 25, Female 20, Smokers, Guaranteed premiums, Term 25 years | £9.99 | £9.42 | -6% |
| Guaranteed Level Life or Earlier Critical Illness Cover (with TPD) | |||
| Female, 20, Non-smoker, Guaranteed premiums, Term 25 years | £16.82 | £15.33 | -9% |
| Male, 20, Smoker, Guaranteed premiums, Term 30 years | £34.46 | £30.37 | -12% |
| Male, 30, Non-smoker, Guaranteed premiums, Term 35 years | £57.88 | £57.34 | -1% |
| Guaranteed Decreasing Life or Earlier Critical Illness Cover (with TPD) | |||
| Joint Life, Male 25, Female 20, Smokers, Guaranteed premiums, Term 25 years | £33.37 | £31.31 | -6% |
| Female, 20, Smoker, Guaranteed premiums, Term 25 years | £16.92 | £12.56 | -26% |
| Female, 45, Non-smoker, Guaranteed premiums, Term 25 years | £89.71 | £61.14 | -32% |
Assumptions:
- Exact ages used
- Premium changes for specific cases will vary.
- Payments quoted are all monthly amounts
- Total Personal Disability Cover included
- No Life Cover Buy Back option
- Age definition is Age x attained
- Decreasing covers use a 10% mortgage interest rate
- Account fee included
- £100,000 sum assured
- 4 year clawback
- Ends -
Notes to editors
The AXA Protection Account was launched in 2004 and products include Life Cover, Critical Illness Cover, Income Protection Cover, Life or Earlier Critical Illness Cover, Mortgage Income Protection Cover, Accident Sickness & Unemployment Cover and Business Cover: Keyperson Protection, Shareholder Protection and Partnership Protection.
AXA Protection accepts over 75% of lives at normal rates and declines less than 2.5% of lives. AXA Protection was the first UK insurer to launch full tele-underwriting nationwide and 2007 statistics show just 1.23% non-disclosure for tele-underwritten applications.
AXA Protection was winner of What Mortgage Magazine's award for Best Life Insurance Provider in 2007. In 2008 Defaqto awarded AXA 5 Stars for its Level and Decreasing Critical Illness, Stand Alone Critical Illness and Income Protection products. AXA also won Most Improved Provider, Best New Initiative, Best Underwriting Team, Best Individual Impact – Naomi Greatorex, TCF Award and Best Overall Provider at the LifeSearch Awards 2008.
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About AXA
AXA UK is a part of the AXA Group. AXA Group is a worldwide leader in Financial Protection. AXA's operations are diverse geographically, with major operations in Europe, North America and the Asia/Pacific area. IFRS revenues amounted to €94 billion for the full year 2007.
The AXA ordinary share is listed on Eurolist A of Euronext Paris under the ticker symbol CS (ISIN FR0000120628 - Bloomberg: CS FP - Reuters: AXAF.PA). The American Depository Share is also listed on the NYSE under the ticker symbol AXA.
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