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Fracture cover - helping consumers with short term income loss

News Article

Publication date:

05 June 2019

Last updated:

05 June 2019

Author(s):

Joshua Jinks

Understanding how to provide Fracture Cover in case of an injury.

Suffering a fracture can lead to unforeseen financial stress particularly for those who have physically demanding occupations. Fractures can make it difficult or even impossible for clients to work for weeks or even months whilst they recover. This week we look at Fracture Cover amid a number of recent changes ranging from Guardian removing the benefit altogether to other insurers apply automatic exclusions.

Those that offer Fracture Cover include it as an added value benefit which will not affect the client’s ability to claim on the core cover. Currently all providers cover the life assured only and not wider family members. The table below shows which insurers currently offer Fracture Cover and the products they are available on.

 

What products do providers offer fracture cover with?

 

AEGON

Aviva

LV=

Royal London

Zurich

Life Cover

 

X

 

 

X

Critical Illness

X

X

 

 

X

Income Protection

 

X

X

X

X

Business Protection

X

 

 

X*

 

*Business Income Protection Only

Some providers offer Fracture Cover at no additional cost and automatically include this in their policy whilst others offer the benefit as an add on to their plan with an additional monthly premium applied. The table below shows each provider’s charging structure.

 

What do providers charge for fracture cover?

 

AEGON

Aviva

LV=

Royal London

Zurich

Monthly Cost

Automatically

Included

£4 per month

Automatically

Included

Automatically

Included

£4 per month

Fracture Cover can insure clients against various types of fracture, with providers specifying a different pay-out for each one. In general, the bigger an impact a fracture will have on the client’s lifestyle the bigger the amount that will be paid. The table below illustrates what providers will pay-out for different bone fractures.

 

 

What is the value of cover offered per fracture by providers?

 

AEGON

Aviva

LV=

Royal London

Zurich

Skull (open fracture)

£1,500

£6,000

£2,000

£4,000

£6,000

Skull (closed fracture)

£1,500

£4,000

£1,000

£2,500

£6,000

 Cheekbone

Do not cover

£1,500

£1,000

£1,500

£2,000

Jaw

Do not cover

£3,000

£1,000

£2,000

£2,000

Collar Bone

Do not cover

£1,500

£500

£1,500

£2,000

Shoulder blade

Do not cover

£2,000

£1,000

£1,500

£2,000

Sternum

Do not cover

£2,000

£1,000

£1,500

£2,000

Arms

Do not cover

£3,500

£1,000

£2,500

£4,000

Ribs

Do not cover

£1,500

£500

£1,000

£2,000

Vertebra

£1,500

£2,500

£1,000

£2,000

£4,000

Wrist

Do not cover

£2,000

£1,000

£1,500

£4,000

Hand

Do not cover

£1,500

£1,000

£1,500

£2,000

Pelvis

£1,500

£2,500

£1,000

£2,000

£6,000

Upper Leg

Do not cover

£6,000

£2,000

£4,000

£6,000

Knee

Do not cover

£6,000

£2,000

£4,000

£6,000

Lower Leg

Do not cover

£4,000

£1,000

£2,500

£6,000

Ankle

Do not cover

£2,500

£1,000

£2,000

£6,000

Foot

Do not cover

£2,000

£1,000

£1,500

£2,000

The table highlights that the providers who charge for Fracture Cover separately, Aviva and Zurich, offer larger pay-outs for most fracture types. Naturally, the greater the pay-out the greater the chance the client will not encounter financial difficulties. 

If a client fractures multiple bones at the same time then AEGON, Aviva and LV= will all pay out on the fracture that offers the highest pay out. Whereas Royal London and Zurich will pay out for multiple fractures. 

Zurich’s Fracture Cover takes the concept further, being the only insurer who also covers ligament tears, tendon ruptures and dislocations.

 

What ligament tears, tendon ruptures and dislocations Zurich Cover and how much?

Ligament Tears and Tendon Ruptures

Lump Sum

Knee, Achilles

£6,000

Dislocations

Lump Sum

Spine or Hip

£,6000

Knee, ankle

£6,000

Shoulder, elbow, wrist

$4,000

Jaw, Middle ear bones

£2,000

In recent times a number of insurers have added exclusions to their fracture cover which were not applicable when the benefit was first offered. AEGON and Royal London hold no such standard exclusions on their policy, where as Aviva, LV= and Zurich apply exclusions for the following pastimes:

These unique features in Zurich’s Fracture Cover make for an appealing proposition. With their generous pay outs for fractures and the fact they offer the service across their whole product range, Zurich appear to be leading the way in Fracture Cover albeit they do not currently offer a Business Protection product. Within the Business Protection space both Royal London (IP only) and Aegon include this valuable benefit as standard and at no extra cost.

Key points to consider:

  • What financial impact would a fracture, tear or dislocation have on the client?
  • Are there any injuries which the client may be prone to due to their occupation or hobbies?
  • What sick pay benefits is the client entitled to?
  • What amount of emergency savings does the client have?

 

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This document is believed to be accurate but is not intended as a basis of knowledge upon which advice can be given. Neither the author (personal or corporate), the CII group, local institute or Society, or any of the officers or employees of those organisations accept any responsibility for any loss occasioned to any person acting or refraining from action as a result of the data or opinions included in this material. Opinions expressed are those of the author or authors and not necessarily those of the CII group, local institutes, or Societies.

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