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Withdrawal of Tax Efficient Life Insurance Plan
(TELIP) - Latest Update
Deadline for completion of TELIP cases
approaching – 5 April 2007.
As you know, we have had to withdraw our pension
term assurance product, Tax Efficient Life Insurance Plan
(TELIP) following the pre-budget speech by Her Majesty’s
Treasury in December 2006. Please note that the
deadline for completion of this business is fast approaching,
so there is only a limited amount of time left for you to
complete your pipeline TELIP cases.
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In
order to meet the Government’s deadline, we must have
completed and authorised TELIP cases by Thursday 5 April
2007.
We want to help you as much as possible in
successfully completing as many eligible TELIP plans as
possible.
To do this, we have created a TELIP
‘deadline-busting’ underwriting priority service to help
you do this. This is
available from your normal service team. Click here for more
details.
Wherever possible,
please make sure you send us any outstanding
requirements, particularly any medical requirements,
well before 5 April. We must ensure that there is
enough time to deal with them before the deadline.
There are a number of cases where
the start date is the only outstanding requirement, and
are ready to go on risk. Please review
your pipeline and saved cases to see if any of these can
be
completed.
A
start date must be appropriate and can be up to 60 days
from 5 April 2007.
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The industry-wide deadline
of 5 April 2007 was
imposed
by the Government, so we cannot process any TELIP business
after this date.
We
aim to do everything we can, to process this pipeline business
as quickly as possible to get these cases on cover.
However, if
information is sent to us at the last-minute, there is a risk
that it may not receive authorisation before the
deadline.
Please note:
only applications for TELIP that were completed by 6 December
2006 and received by us by the 13 December 2006 can be issued
as a TELIP policy.
Any
TELIP cases that have not been completed by the deadline can
be switched to Ordinary Term Assurance (OTA). If your client
would like to switch, you will need to confirm that the case
has been re-sold to them. If they wish to proceed, please let
your usual service team know and they will switch it to OTA.
The new premium will then be calculated, based on our current
term assurance rates.
What happens to clients
who have a Guaranteed Insurability Option on their existing
TELIP?
There
will be a number of existing TELIP cases that will be eligible
for Guaranteed Insurability Option (GIO). If these policyholders
wish to exercise their GIO, due to the changes in the rules*,
we won’t be able to issue a new TELIP policy for the
additional amount of cover. However, we will still
be able to honour the GIO, and will instead provide the
policyholder with Ordinary Term Assurance for the additional
cover.
*Although
the rules currently state that we cannot issue a new TELIP
policy, this may change, depending on future budget
announcements.
Contact
Us
If
you need any help or have any questions on TELIP or any other
matter, our specialist Protection sales team are only a phone
call away.
If you
would like further information on the above, please contact us.
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