This option allows your client to increase their level of cover without disclosing any further medical, pastimes or occupation details.

YOUR CLIENT CAN INCREASE THEIR LEVEL OF COVER ON THE FOLLOWING EVENTS:

For Life and/or Critical Illness Cover and Family and Personal Income Plan

• A mortgage increase due to a house move or major improvements to an existing property
• A salary increase due to a new job or promotion (not applicable to Term or Critical Illness Cover policies taken out before 23/05/10)
• Marriage or entry into a registered civil partnership
• The birth or adoption of a child

For Income Protection Benefit

• A mortgage increase due to a house move or major improvements to an existing property
• A salary increase due to a new job or promotion
• Every third policy anniversary

For Whole of Life Protection Plan

• A mortgage increase due to a house move or major improvements to an existing property
• Marriage or entry into a registered civil partnership
• The birth or adoption of a child
• Divorce or dissolution of a civil partnership

For IHT

• An increase in the expected IHT liability
• An increase in the IHT rate
• A reduction in the IHT tax rate bands, exemptions or reliefs

For Business Protection:

• Increase in a business loan
• The value of a key person to the business increases
• A working partner’s or director’s interest in the business increases in value

For all plans

The GIO can be exercised up to 3 times in total, although only once for marriage/entering into a registered civil partnership or divorce/ dissolution. And only once for IHT on a Whole of Life Protection Plan.

The GIO must be exercised within six months of the event.

Amount of increase allowed:

For Income Protection Benefit

The lesser of:

• £10,000 p/a or £833.33 per month
• 50% of the monthly benefit

The maximum amount can’t exceed the maximum benefit level.

For Business Protection

The lesser of:

• £150,000
• The amount of the loan increase
• The amount of the increase in the value of the employee, or increase in the ownership interest (whichever applies)

The maximum overall total for all increases permitted is £250,000

For the Whole of Life Protection Plan

If this is used for family protection, the lesser of:

• One third of the original sum assured
• The amount the increase in the mortgage
• £50,000

The maximum overall total for all increases permitted is £150,000

If this is used for IHT purposes, the lesser of:

• £100,000
• The amount of increase in IHT liability
• 50% of the original sum assured

If this is used for business protection, the lesser of:

• £100,000 or if less, then the increase in the loan
• one third of the original sum assured

The maximum total for all increases permitted in £250,000

In order to include a GIO, the following criteria will apply:

• The original plan must be started before your client’s 45^th birthday (older life on a joint life policy)
• The plan must be accepted on standard terms and normal rates
• The option must be exercised before the life assured’s 55^th birthday (50^th birthday for IPB and Whole of Life Protection Plans if this is for family or business protection and for Term and Critical Illness Cover plans taken out before 23/05/10. If the Whole of Life Protection Plan is for IHT purposes, then it will be their 65^th birthday).
• When the option is exercised, a new policy is issued for the additional amount on the terms that apply at the time. The original policy will also continue.
• The GIO can’t be exercised if your client is suffering a disability or if the policy is subject to a terminal illness, critical illness or waiver claim.
• For IPB, a GIO can’t be exercised if your client is incapacitated or has made a valid claim.
• When exercising a GIO, no other product features can be changed. The new policy end date can’t be later than the original policy and all deferred periods (if applicable) have to remain the same.