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Lutine Assurance will be entering the Pension Term Assurance Market with effect from 9th October 2006. In a first move for the Life Protection Company, they will be offering indemnity commission at 170% of the first year’s premium on this product whilst still maintaining a competitive premium.

Lutine Assurance is probably best known for its flexible approach to unusual, technically complex or high sum assured cases. Lutine’s Pension Term Assurance product will see a move away from this area to more straight through processing with premium terms that reflect this process.

The product will be geared to an easy application process and therefore will be restricted to a maximum sum assured of £300,000 any one life and a maximum age at entry of 50 attained to keep medical evidence and financial requirements to a minimum.

Lutine has long been renowned for its approachable, flexible stance on underwriting issues. However this was on products where we were unable to finance indemnity commission and were not always able to provide top quartile rates.

Our Pension Term Assurance products have been designed to provide competitive indemnity commission terms and competitive rates. This means that we have to manage our costs quite aggressively.

As such the underwriting approach we will be taking on our Pension Term Assurance product will be much more ‘clinical’. We are aware that there is nothing worse for brokers than taking time to ‘sign up’ clients only to have insurers decline cases or spend endless amounts of time requesting medical evidence.

At Lutine we have always believed in being up front with our brokers and our clients and where possible to manage everyone’s expectations of what the likely outcome will be at as early a stage as possible.

This leaflet is therefore designed to let you know that if your client has suffered from any of the following conditions it is probably not worthwhile completing our Pension Term Assurance proposal.

Below are the lists of conditions:-
Cancer including Leukaemia Hodgkin’s disease, lymphoma, brain or spinal tumour
Heart attack, angina, heart defects from birth and heart surgery
Stroke, circulatory problems, brain haemorrhage or permanent brain injury
Multiple sclerosis, Parkinson's disease, paralysis, Alzheimer's disease, dementia or cerebral palsy
Mental Illness that has required hospital treatment or referral to a psychiatrist or ever involved self harm or suicide attempts
Hepatitis B and C, Ulcerative colitis or Crohn’s disease

Clearly we still cannot say that every proposal we receive will be acceptable but hopefully we have given a good indication of cases where it may not be in the interests of yourselves or the life assured to complete the proposal form.

We would stress that on our non Pension Term Assurance products you will still receive the same ‘hands on underwriting approach’ for which Lutine is renowned.

One last plea to all brokers who want to use our services, please ensure any proposals submitted are fully answered and completed with full details where applicable. This avoids us having to request information that could be obtained when completing the proposal, thereby wasting our time, your time and the client’s time.

Thank you.

Martin Herrick,
Chief Underwriter.

Managing Director of Lutine, Jon Clarke comments:-
“This is not only a competitive product for consumers with our keen pricing and the tax relief on premiums but is also our first product to include indemnity commission to IFA’s.”

Shaun Murphy, Sales & Marketing Manager comments:-
“We have been asked for sometime, by a large part of the IFA community, when we would be able to offer indemnity commission. Well... the answer is ‘now’, on this product.”

Underwriting Manager, Martin Herrick comments:-
“We have been known for our ability to help with complex cases. We now want to show that brokers have a simple Pension Term Assurance product, where contact with the underwriters is more limited, but provides a quick ‘no nonsense’ underwriting approach. We will still look to provide our ‘hold the hand’ approach on our other products but this product has rates and a process designed to give IFA’s what they have been telling us they want. That is good rates, with indemnity commission and a quick response time.”

Questions to Shaun Murphy Sales & Marketing Manager on:- 07971 741 724.

Below is the product Specification:-

LUTINE ASSURANCE
Product specification for long term Pension Term Assurance

Term: Minimum term is 10 years 1 day and maximum term is 25 years
Sum Assured: No minimum (governed by minimum premium). Maximum is £300,000.
Ages: Minimum age is 18 attained and the maximum age is 50 attained. Cover must expire by age 70 attained.
Premium: Minimum premium is £5.00 per month. There is no annual or single premium option.
Clients: Open to male and females and smokers and non smokers.
Smokers: We class smokers as anyone who has smoked cigarettes within the last 12 months or who smokes more than 1 cigar per day on average. Smokers pay a higher premium than non smokers.
Large sum Assured Discounts: There are various large sum assured discounts that apply from £50,000 sum assured upwards.
Medical Evidence: We will employ a certain level of ‘streamlined underwriting’. As such the majority of lives will be acceptable on just an automatic proposal form. The only other automatic medical evidence will be paramedic screenings for ages over 40 up to age 45 who require cover in excess of £200,000 or for ages over 45 up to 50 who require cover in excess of £150,000.
Additional benefits: As this is a Pension Term Assurance product there are no additional Benefits that can be added. Terminal Illness cover is automatically included.
Trusts/Assignments: Cover can be written under a trust or can be assigned.
Type of Policies: We can offer a level term contract or a Mortgage Decreasing Term Contract based on a maximum interest rate of 12% per annum.
Commission: We will pay Indemnity commission of 170% of the first year’s annualised premium (equivalent to approximately 153% LAUTRO) with renewal commission of 2.5% payable from month 49 onwards. The clawback period is pro-rata during the first 48 months.

Quotes: Can be obtained from ‘the Exchange’ or http://www.lutine.com

Voting began in February when questionniares were sent out to Financial Adviser's IFA readers who were invited to grade companies in relelvant areas including: product innovation, performance, sales & marketing, broker support, rate competitiveness, capital protection and charges. Votes were collated and analysed by a firm of independent actuaries.

Mortgage Payment Protection

Competition in the mortgage payment protection (mpp) market intensified last month with the launch of a new stand alone policy from Lutine. Available for both new mortgages and re-mortgages , the policy provides cover against accident, sickness and unemployment.

"With two-thirds of mortgagees uninsured, the MPP market offers good growth potential, " commented Jon Clarke, managing director, Lutine. "A number of factors are important. We have a high level of mortgage debt in this country, the economy is turbulent, and the government has reduced the amount of state support available. The onus is, therefore, on individuals to take more responsibility for their financial well-being."

Premiums begin from £4.40 per £100 benefit for new mortgages, and £5.50 per £100 benefit for re-mortgages. The policy is underwritten by Cassidy Davis Insurance Group, underwriters at Lloyd's of London.

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