Aviva Key Man Insurance Review
A detailed review of Aviva key man insurance, covering policy details, the main benefits and general information about Aviva.
What is key man insurance?
Key man insurance, also known as key person insurance, is a financial product, which offers businesses protection against critical illness, terminal conditions and death. Most companies are reliant on core members of their teams. Key man cover is designed to safeguard businesses in the event of a key person dying or being unable to work due to poor health. Key person cover provides funds directly to the company. The payout can help to cover losses and enable the business to continue operating.
There are multiple key man insurance providers in the UK. Aviva is one of the best-known keyman insurance companies. In this Aviva key man insurance review, we’ll outline the policy details, highlight the benefits and explore the types of cover offered by Aviva.
What is Aviva key man insurance?
Aviva key man insurance is a form of insurance that provides protection for key individuals within a business. Unlike personal life insurance policies, payment is made to the company, rather than to beneficiaries, such as family members. Aviva’s key man insurance cover is known as Business Life Insurance Options and it is provided by Aviva Life & Pensions UK Limited.
Aviva offers clients the option to insure the life of critical team members. Research suggests that 52% of companies believe they would fold in less than 12 months following the loss of a key person (source). Examples of key people include directors, office managers, partners and employees without whom the business wouldn’t run smoothly and efficiently.
Aviva Business Life Insurance Options offers life cover or life cover with critical illness. Both policies provide terminal illness cover. To benefit from Aviva key person insurance, applicants must meet the eligibility criteria and agree to pay a monthly or annual premium for the agreed term.
Who are Aviva?
Aviva is one of the UK’s largest insurance providers. The company currently has more than 15.5 million customers and has paid more than £30.6 billion in claims and benefits since 2020. Aviva has roots that stretch back hundreds of years, but it has been recognised as Aviva since 2002. Previously, it was known as the Norwich Union Society for Insurances on Lives and Survivorships. In 2021, Aviva paid out over 98% of claims (source).
The most popular insurance products sold by Aviva include:
- Life insurance
- Home Insurance
- Car insurance
- Critical illness cover
- Health insurance
- Business Insurance
Does Aviva have good reviews?
Aviva has a very high rating on Trustpilot with a score of 4.5/5 from over 25,000 reviews. These reviews cover a wide range of insurance and other financial products and are not specifically related to key person insurance or business cover.
Key facts about Aviva key man insurance policy
Key facts about Aviva’s key man insurance policy:
- There are two levels of cover available: life cover and life cover with critical illness
- Both policies offer terminal illness cover
- Policies are available for people aged between 18 and 77 (life cover) and 18 and 64 (life cover with critical illness)
- The policy can last between 1 year and 50 years
- Policyholders have the option to choose a term or specify an end date based on the insured individual reaching a certain age
- There are two types of cover available: level and decreasing. Increasing cover can be added to the policy. This means that the premium will increase.
- Businesses must be incorporated and registered in the UK.
- Applicants and the life insured must live in the UK, the Isle of Man, the Channel Islands or Gibraltar
- All applicants must be over 18
- Aviva will only pay the total policy amount once. Once a claim has been processed, the policy will end automatically.
Types of cover offered by Aviva
Aviva offers a diverse range of insurance policies for UK customers, including home, pet, car, travel, health and life insurance. Business insurance options include public liability insurance, employers’ liability insurance, professional indemnity insurance and tools, stock and equipment insurance.
There are two types of Aviva key man insurance available. The Business Life Insurance Options policies from Aviva include:
- Life cover
Life cover provides protection against the key person dying. If the insured individual dies during the policy term, Aviva will pay out.
- Life cover with critical illness
Life cover with critical illness offers additional protection. As well as offering financial assistance when a key person dies, the policy also covers critical illnesses. If the individual is diagnosed with a listed critical illness during the policy term and survives for at least 10 days, the holder can make a claim. There is a specific list of critical illnesses covered by the Aviva key person insurance policy. If the disease is not listed in the policy guidelines, the holder cannot make a claim.
Both the life cover and life cover with critical illness policies protect against terminal illness. If the insured is diagnosed with a terminal illness, which is covered by the policy, Aviva will pay out.
If you take out an Aviva Business Life Insurance Options policy, you can choose between two levels of cover:
- Level cover: this represents a lump sum payout. The amount remains the same throughout the policy term.
- Decreasing cover: decreasing cover is a lump sum payment. The cover amount decreases each month in line with interest rates on a repayment loan. The rate is fixed and is usually between 4% and 18%.
What about increasing cover?
Aviva also offers customers the option to add increasing cover. Increasing cover is designed to help combat the effects of rising inflation rates. If you choose this option, your cover will automatically adjust every year.
There are two types of increasing cover: index-linked increasing cover and fixed increasing cover. With index-linked increasing cover, the amount rises in line with changes in the Retail Price Index. The maximum increase is 10%. Premiums increase in line with RPI modifications, which are multiplied by 1.5. The maximum increase in premium payments is 15%. Fixed increasing cover gives you the option to set the increase at either 3% or 5%. The premium will increase by the fixed rate multiplied by 1.5.
What is Aviva’s Relevant Life Insurance with Critical Illness?
Aviva offers a policy known as Relevant Life Insurance, which offers employers the option to insure an employee’s life and add critical illness cover. Adding critical illness cover to a life insurance policy provides additional protection against a wide range of illnesses and diseases. There are strict criteria for critical illness claims. In some cases, individuals have to develop permanent symptoms to make a claim and Aviva will only pay out if the illness is listed within the policy details. You can find out more on Aviva’s Relevant Life Policy with critical illness here.
Taking out critical illness cover is beneficial for companies and individuals. Statistics show that 50% of people born after 1960 will develop cancer in their lifetime. The probability of critical illness increases with age. The diversity of conditions covered by critical illness policies also means that many policyholders are eligible to claim. Aviva statistics show that over 92% of critical illness claims were approved in 2021. In total, Aviva paid out more than £309,000,000 (source).
Which illnesses are covered?
According to Aviva, the following critical illnesses are covered by the Business Life Insurance Options policy:
- Alzheimer’s disease and pre-senile dementia
- Aorta graft surgery
- Aplastic anaemia
- Bacterial meningitis
- Benign brain tumour
- Benign spinal cord tumour
- Cancer (in some cases)
- Cardiac arrest
- Heart attack
- Heart valve replacement or repair
- HIV infection
- Intensive care ventilation
- Kidney failure
- Liver failure
- Major organ transplant
- Limb paralysis
- Motor neurone disease
- Multiple sclerosis
- Parkinson’s disease
- Rheumatoid arthritis
- Severe lung disease
- Spinal stroke
- Traumatic brain injury
This is a guide and it is not a full list of the conditions covered by the policy. It is also important to note that there are conditions attached to several illnesses.
Life and critical illness cover also includes additional critical illness benefits, including but not limited to:
- Bladder removal
- Low-grade prostate cancer
- Crohn’s disease
- Carcinoma in situ of the breast
- Cerebral aneurysm
- Ulcerative colitis
The list of critical illnesses covered by Aviva’s Relevant Life Insurance with Critical Illness policy is very similar to the list above, but it does also cover some advanced cases of cancer. Aviva provides full lists of critical illnesses and claim eligibility criteria in its policy conditions.
What else is included in Aviva’s key man insurance policy?
Aviva’s key man insurance policy (Business Life Insurance Options) also includes business change benefits. This is designed to help companies to ensure that their policy remains suitable if the business expands, for example. If you want to increase the amount of cover, you can do so without answering any additional medical questions. Examples of business changes include an increase in the value of the key person and an increase in the value of a business loan.
In some cases, holders can also add extras to their policy, including:
- Increasing cover
- Waiver of premium
- Conversion options
- Renewal options
- Instalment options
- Total permanent disability
What are the main benefits of Aviva key man insurance?
Aviva key man insurance offers the following benefits:
- Cover provided by a well-known, reputable, established UK insurance provider
- Protects against financial losses in the event that a key person dies or develops a critical illness
- Offers level and decreasing cover as well as the option to add increasing cover
- Open to a wide range of employers and business owners
- Included extras, such as business change benefits
- Peace of mind: key person insurance can help businesses to stay afloat if a vital team member is injured or too ill to work.
How to buy an Aviva key man insurance policy
If you and the person you want to insure are 18 or over, you live in the UK, Channel Islands, Isle of Man or Gibraltar and your company is registered in the UK, you may be eligible for Aviva’s Business Life Insurance policy. It’s important to read the policy details thoroughly and check the eligibility criteria before you apply.
The best way to buy Aviva insurance to protect your company is through a broker. A broker will be able to discuss the key facts and features of the policy with you and they can also answer questions and make recommendations based on your needs.
To apply for a policy, you will need to complete an application form, which contains information about you and the person you want to insure.
To ensure that you benefit from your Aviva Business Life Insurance policy, you should:
- Make sure that all the information you provide is accurate, complete and up-to-date
- Inform Aviva of any changes or developments that could impact your cover between applying for a policy and the policy start date
- Keep up with repayments
- Review your requirements regularly
Who should consider an Aviva Business Life Insurance policy?
Aviva Business Life Insurance policies are designed to benefit company owners and employers who want to insure their most valuable and influential employees. If the key person dies or develops a critical illness during the policy term, insurance can help to ease financial pressures, keep companies going and provide funds for recruitment or temporary support.
Is Aviva a good choice for me?
If you are looking for key person insurance, Aviva is one of the leading UK providers. Aviva is a well-known insurance company, it has excellent reviews on Trustpilot and it has a high payout rate.
With any insurance policy, it’s beneficial to shop around, get quotes from different providers and compare prices and policies before deciding which to buy. Seeking expert advice can help to ensure that you make a well-informed decision.
Aviva is one of the biggest insurance providers in the UK and it is one of a select group of companies that offers key person insurance for businesses and employers. Aviva offers life cover and life cover with critical illness to protect companies and provide peace of mind.
Jody is the Managing Director and founder of My Key Finance Ltd. He has over 16 years experience as a protection adviser and is an authority within the UK business protection market. Jody has written articles for Business Matters Business Directory, and been featured in Forbes. As editor and Author of our blog Jody is hoping to educate and advise people with more in depth details and information on the various subject relating to the protection market.