Canada Protection Plan co-president bares thinking behind coverage increases

Changes to two life insurance plans address greater financial needs faced by policyholders

Canada Protection Plan co-president bares thinking behind coverage increases

As the co-president of Canada Protection Plan, a leader in no-medical and simplified life insurance, Michael Aziz is a passionate advocate of simplicity. So it should be no surprise that two of the company’s life insurance plans have been updated for straightforward reasons.

On Monday, Canada Protection Plan announced that it is increasing coverage under its newest product, the Express Elite Term Life plan, from $500,000 to $750,000. A no-medical life insurance product, the plan is available to clients between 18 and 60 years of age; applications can be filed over the phone or through an advisor, including an advisor-provided online platform, and it can be approved in days with clients receiving coverage promptly.

“This is a product for healthy people,” Aziz explained to Life and Health Professional. “We’ve realized that $500,000 is a good face amount for most people. But for young people who are busy and don’t have time for medical exams, but still want more coverage to protect their needs, we could go up to $750,000 and cover more customers.”

As a specific example, he noted that a young couple buying a condo in Toronto could carry a mortgage of up to $789,000; for those buying a house in the outskirts of Toronto or Vancouver, the minimum amount would be in the range of $800,000 to $900,000.

“That’s the reason we decided to increase the maximum face amount,” Aziz said. For existing Express Elite Term Life policyholders, Canada Protection Plan is implementing a simplified process to increase their face amount to a maximum of $750,000 without having to complete a new application.

The company also doubled coverage for its Guaranteed Acceptance Life Insurance plan from $25,000 to $50,000. Offered to clients aged 18 to 75 with challenging health conditions, it guarantees that policyholders will not be declined for coverage regardless of their state of health.

“Canada Protection Plan is considered the leader in the hard-to-insure simplified issue market,” Aziz said. “Especially when it comes to final expenses and certain people that have had health concerns, we’ve found that $25,000 wasn’t enough. So once again, we’re just allowing the people that fall into that guaranteed-acceptance category to get more insurance.”

Offering additional choice is a natural next step for the blossoming simplified-issue market. Given people’s busy day-to-day lives, every bump in the traditional life-insurance application process adds up: booking an appointment for a nurse to perform a paramedical exam, an underwriting process than can take anywhere from a week to three months, and even having to sign a physical document can test one’s patience. For some, it’s not just about the inconvenience — they may want coverage, but harbour an aversion to getting pricked with medical lancets or needles.

“Getting insurance can be a daunting experience for people. But when a client realizes that they can get $750,000 of coverage within 15 minutes by completing an application just answering ‘yes’ or ‘no,’ that to me is powerful,” Aziz said. “When you make things simpler and easier to understand, it takes away the fear factor, and people are more likely to embrace the coverage.”

Learn more news about life and health insurance in Canada here.