> The initial premium is shown in the schedule , the first payment is due to Sovereign on the first premium due date . > The premium comprises the cost of the benefits chosen plus the policy fee if any. > The premium amount may change from time to time (as described below) and you will need to pay the new premium on the agreed regular basis. Sovereign will advise you of the new premium before the change. > The enclosed policy illustration gives details of the likely changes.
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Sovereign’s underlying premium rates at that time.
> Where a premium type of 10 years, to age 65 or to age 80 has been selected and all benefits are Level, your premium has been calculated over the selected period and Sovereign will only change your premiums over the selected period if the underlying premium rates change. If the underlying premium rates change, then at the next anniversary date Sovereign will recalculate the premium to apply for the remainder of the selected period (subject to any further underlying premium rates changes). At the end of the selected period, the premium type will convert to Rate for Age. Notwithstanding the above, for Life Cover, Family Protection and Accidental Death benefits, Sovereign guarantees the underlying premium rates (subject to relevant changes in taxation or legislation). > Where a premium type of 10 years, to age 65 or to age 80 has been selected and the benefits are CPI linked, your premium has been calculated over the selected period and in addition to any underlying premium rate changes (see above) your premium will increase annually in line with any increase in your benefit. The increase in premium will be based on the increase in the sum assured and the current age of the life or lives assured.
Method of paying premiums
You must pay all premiums to Sovereign. Premiums can be paid by direct debit, credit card or debit card. Premium payments are not effective until after they have been credited and cleared to Sovereign’s bank account. What happens if you do not pay the premium on time? You have 30 days’ grace in respect of any premium due. Sovereign will be entitled to cancel your policy by written notice to you at your last known address if a premium remains outstanding 31 days after a premium due date . If you want to have the policy reinstated, you must write to Sovereign. Sovereign does not have to reinstate the policy but may do so on any conditions it considers appropriate. If Sovereign has to pay a non-health benefit under the policy when a premium is overdue, the overdue premium may be deducted from the claim payment. If Sovereign has to pay a health benefit under the policy when a premium is overdue, the overdue premium must be paid before Sovereign makes the health claim payment.
Irrespective of the type of premium you have selected:
> All changes to your premium as described above will take effect from the anniversary date . > Whenever the premium is recalculated, the premium will not be affected by any change in health of a life assured which has occurred since the benefits were first added to the policy. > Premiums will always be based on premium rates adopted by Sovereign for each benefit so that no single client can have his or her premium recalculated in isolation. Any policy fee will normally increase annually in line with the consumer price index . However, if all benefits for all lives assured are Level and the premium type selected is 10 years, to age 65 or to age 80 then the policy fee will also remain unchanged until the end of the selected period. Premium increases will always be applied across a class of business. No increase in premium will apply to your own policy based on your own claim experience.
When can the premium change?
There are a number of circumstances that can change the premium you pay.
Premium type Sovereign calculates the premium for each of your benefits based on the premium type chosen and whether the benefits are Level or CPI linked. Premiums can be structured in the following ways:
Rate for Age;
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10 years; To age 65; To age 80.
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Health premiums
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It is Sovereign’s normal business practice to review premiums for health benefits on a regular basis. This is usually done each year on the anniversary date . Please note that: > Premium increases will always be applied across the policy type. > There will not be an increase in premium for your own policy based on your claim history or experience.
The premium type(s) you have selected are shown in the schedule . How this affects the premium you pay is explained below: > Where Rate for Age has been selected, your premium will be recalculated at each anniversary date based on: - the age of the life or lives assured; - the amount of cover for each benefit (for non- health benefits only); and
800 TC-UMB Version 9 Effective 06 March 2017
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