NB the Sections in BLUE Type Relate Specifically to REBROKED Cases

NB the sections in BLUE type relate specifically to REBROKED cases –

they’re highlighted in blue to make them easier to delete for those cases which are not rebrokes.

Name

Address

Address

Address

Address

Date

Dear Name

I am writing to you, following our previous discussions, to detail the recommendations that I feel are appropriate to your circumstances. These recommendations are based on the information supplied by you in the Personal Financial Planning Profile completed on Date. The recommendations are aimed at meeting your objective of reviewing your current protection needs.

You were concerned that the event of your death would impact considerably on your family’s current standard of living. I therefore recommend that you should effect a Level Term Assurance policy, which will provide a lump sum in the event of your death during the term of the plan. We identified your current income, expenditure and liabilities, and we have taken this information into account when agreeing a sum that would suit your circumstances and budget.

We agreed that your objectives were to insure yourself against these events for £Amount and this recommendation is aimed at meeting this objective. (Insert some explanation as to why / how this amount was arrived at - is it sufficient to maintain the clients and/or family’s lifestyle long term, or not – does it provide a breathing space to allow recovery – does it pay off or reduce any outstanding mortgage – if the sum is not ideally sufficient, are premium cost constraints / affordability an issue).

You feel the need for this protection will cease in number of years. I therefore recommend that you implement a Level Term Assurance Policy written over a ___year term with a sum assured of £Amount on a single life/joint life first death basis. This should be sufficient to repay the loan / for your requirements if you / either of you were to die.

Cover why a Family Income Benefit policy was not recommended as a potential alternative;We discussed that as an alternative to a Level term Policy, a Family Income Benefit policy would pay a monthly income for the remaining term following your death, to your dependents.However you preferred to have a lump sum payment as this would enable your family to clear outstanding debts / provide them with control of the fund and any income arising /you preferred a known fixed level of cover rather than a monthly amount which may in total be greater or less than the fixed amount of cover depending on when during the policy term death occurred / plus any other relevant reason….

If applicable include;

The policy also includes terminal illness cover, which may allow you to claim under the policy if you were unfortunately to be diagnosed with an illness likely to result in death within 12 months.

You understand you could also include Critical Illness cover - which pays a lump sum on diagnosis of certain specified major illnesses which may not necessarily result in death, and / or Waiver of Premium benefit – which pays the premiums for you if you were to be unable to work for long periods of time due to medical reasons. You have declined these options as you wish to keep costs to a minimum.

Thesum assured of £Amount can be provided by a guaranteedpremium of £Amount which you confirmed would be affordable throughout the term of the contract. You preferred a guaranteed premium rather than reviewable, as the costs are fixed for the term of the contract.

If the policy is a renewable term plan add; As discussed this policy can be renewed at the expiry of the original term, however do note that the premium will be recalculated at that time and could mean a substantial increase.

OR

Thesum assured of £Amount can be provided by a reviewablepremium of £Amount. A reviewable premium means that the premium will increase at specified dates (describe), whereas a guaranteed premium does not change through the term of the policy. You are aware that the premium for a similar contract on a guaranteed basis would be £Amount.You have confirmed that the premium is affordable, and are confident that you will also be able to afford future increases in the premium when reviewed by the insurer.You felt that a reviewable premium best suited your requirements because…….(e.g. cheaper now when income is tight)

If the case is a rebroke, include a paragraph with details of the existing policy/policies and an explanation why it/they are being replaced - often for cost reasons but not exclusively e.g.;-

I confirmed that, due to the continuing change in mortality rates, it is now possible to obtain higher levels of cover for the same monthly premium that you are currently paying to Company, over a slightly longer remaining term……………….The remaining term on your existing policy no longer meets your needs(say why)…………………..Your present policy contains reviewable premiums / is shortly due for review / has been reviewed and you would prefer a “guaranteed” policy whereby the premiums are not subject to reviews. ……..……….The lives assured on the policy no longer match your requirements.

Temporary assurance policies do not acquire a maturity value or a surrender value, they simply pay a lump sum if a valid claim occurs. At the end of the policy term, or if premiums cease before that date, the policy will simply expire.

The total sum of the monthly premiums payable over the life of the policy is £XYZ (representing £AB per month x12 months x 5 / 10 / 15 / 20 / 25 years). Do note however that you are able to cancel the cover provided by the policy at any time should you choose, and future premiums will cease.

As your contracthas reviewable premiums and / or includes the benefit of increasing / indexed cover, which means that over the years the monthly premiums and thus the total premiums payable will increase, but at this stage it is not possible to predict what the final total may be.

With regard to medical information, as I mentioned to you it is very important that full information is disclosed to the insurer at the outset. If this is not done, and something subsequently comes to light, a claim may be refused. If you do recall any further information that should have been given please do let me, or the insurer if you prefer, know straight away.

The 'key features document' provides a great deal of information about the terms of the policy - please do study this document carefully and let me know if you have any queries.

If the case is a rebroke, include the following paragraph;-

It is important to note that, at this stage, we are merely applying for your replacement policy to be underwritten to ensure that Product Providerconfirms the terms of cover for you. In this respect, you should not cancel payments to your existing plan until I have advised you of product Provider’s acceptance of terms.

You have confirmed that you do not maintain existing cover for this protection need / although you have some cover which may overlap with this recommendation, you feel your existing cover is insufficient for your needs.(Delete as appropriate if re-broking an existing policy).

If the client has not signed a proposal or input form, include a hard copy of the electronic data input, with the following;-

I also enclose a copy of the information supplied to the insurer based on the details you gave me. It is essential the particulars are correct as they form the basis of the contract, therefore please check the form carefully and advise me as soon as possible of any discrepancies. Please note it is important that the insurer is advised if any changes occur before the policy commences.

Product Provider were selected as being a competitive provider via the exchange on the basis of premium and guaranteed / reviewable cover. Product Provideris also a financially secure company with many years' experience in providing protection policies of this type.

If the selected policy (either guaranteed or reviewable) is not the cheapest, explain why (e.g.selected provider offers more efficient underwriting service / able to consider sum assured required (if high) / provider’s reputation is known and liked by client etc)

It should be possible to put the policy into a trust. This should mean that any payment made on your death would fall outside of your estate, and would not be assessed for inheritance tax purposes. If you wish to do so please contact PRODUCT PROVIDER once the policy has been issued to obtain the relevant trust documents or alternatively contact your solicitor. You have a choice of electing for the trust to be set up at outset, but you can apply the trust at any later stage. If the plan is not put into trust the money will not be accessible until probate is granted on your estate and this will delay receipt of the capital. Having the money in trust will mean the funds are paid out directly to the people who need the capital at the time when they most need it.

We also discussed your estate and your need for a Will. You should be aware that the implications of not doing so is that your estate will be distributed by the Law of Intestacy which may not be as you wish, and is therefore important you consider this aspect. If you have an existing solicitor or an estate planner we would strongly recommend you get in touch with them}.

OR

We also discussed your estate and the advantages of having a Will. I note from our discussions that you have a Will. Please ensure that it is kept up to date as the implications of not doing so is that some of your estate may not be distributed as you would wish}

The illustration that I gave you indicates the normal termsProduct Providerwould offer. They will confirm their acceptance of your proposal by issuing an acceptance letter. Sometimes during underwriting it is possible that the premium may be changed. When you receive this acceptance please check this carefully and contact me straight away if you feel there is anything that is not clearly self explanatory.

I issued you with our Initial Disclosure Document (IDD) and Version number of our Client Agreement on Date and you have received a 'key features document' that provides a great deal of information concerning the terms under which the policy will be issued. The initial commission payable is £Amount as shown on your personalised illustration that we have already discussed. You should read these documents carefully and contact me if you have any queries concerning them. I would like to draw your particular attention to the sections on charges and cancellation.

For my records please sign the copy letter attached and return it to me in the envelope provided.

Yours sincerely,

Adviser’s Name

Title

SIGNED:

Client’s Name (s)