The insurer yesterday launched its Vitality Optimiser on its PruProtect and Essentials Plan, offering all new clients an upfront discount on their protection premiums.
The Vitality Optimiser option can be chosen by clients when taking out a new policy and as well as a discount it also gives them cashback every year if they look after their health with the Vitality scheme.
It aims to address an inherent inequality in the way protection is priced by incentivising and rewarding customers who engage in activities of healthy living on an ongoing basis.
The scheme consists of four key areas.
First, there is an upfront discount for everyone. Based on the term of the policy being taken or the age of the applicant on Whole of Life plans, the discount could be up to 40% off our standard premiums.
Then there is cashback for those engaging in healthy living, up to £100 per policyholder per year, with double cashback for those holding both a PruProtect and a PruHealth policy. That means a couple with both products could receive £400 cashback every year.
Third is the ability to control premiums. Dependent on the level of engagement in healthy living through PruProtect’s Vitality programme, Protection premiums will rise, stay level or fall on an annual basis. And even if no engagement has taken place, the maximum increase is just 2% per year.
And then there’s access to the full range of Vitality benefits which includes free weekly cinema tickets, half price gym membership for Virgin Active or Fitness First and discounts on everything from trainers to family holidays, all for an extra premium of £3 per month.
Controllable behaviours such as exercise, nutrition and smoking have a major influence on chronic diseases such as cancer, heart problems, diabetes and lung disease which contribute to 50% of deaths worldwide.
However, all current Protection policies use a blunt approach to pricing, assessing the client’s risk at a single point in time, failing to take account of their ongoing lifestyle and attitude to health and wellness.
Commenting on the Vitality Optimiser, PruProtect CEO Herschel Mayers said: “We know that most people want to be healthy but insurers fail to encourage their policyholders to actively engage with their day-to-day wellbeing.
“By giving everyone lower premiums, the power to control those premiums over the term of their plan in return for looking after their health, and additional rewards and cashback, we aim to revolutionise the way Protection is sold in the UK.”
Peter Chadborn, protection adviser of Plan Money, said: “Innovation and client engagement do not necessarily go hand-in-hand but I believe Vitality Optimiser achieves both.
“I am also pleased to see refinements that assist in positioning comprehensive concepts in a straight forward way.”