Important Information for Group Income …

1 UP3086 11/2013 Page 1 of 2 Important Information for Group Income protection PolicyholdersWe believe it s Important that our policyholders are clear about the cover they have in place. That s why we have made some refinements to our Group Income protection (GIP) Terms and insert explains the changes we are read it while taking into account the options you have selected for your copy of the new policy Terms and Conditions are available at: in the document of changes:1) We are making some clarifications to these incapacity definitions: Current Occupation Cover (referred to in the policy as Definition A) Combined Occupation Cover (Definition B) Alternative Occupation Cover (Definition C) 2) We are removing these definitions of incapacity.

2 Objective Occupation Cover (referred to in the policy as Definition D) Abilities Test Cover (Definition E) Generic Occupation Cover (Definition F) Combination Occupation Cover (Definition G) 3) We are changing the way we make deductions for Employment and Support Allowance (ESA).4) We are introducing other policy wording changes that will clarify the way the policy ) We are removing the Continuation Clarifications to definitions of incapacity Income protection helps companies ensure that their employees receive the support they need should illness or injury prevent them from working. The basis of the cover is determined by the definition of incapacity and we believe it s Important that this is as clear and straightforward as possible to help policyholders understand the criteria for a valid claim.

3 The first point we are clarifying is about Current Occupation, which becomes Insured Occupation. Most often, the material and substantial duties of an occupation will not differ from employer to employer, but, where this is the case, we are making it clear that we are assessing a person s ability to perform the duties of their occupation generally, for any employer, rather than for the policyholder specifically. For example, if we are looking at a claim for an insurance underwriter, we will be considering what they would have to do, whoever they might be working , where Alternative Occupation Cover applies and we are assessing a person s ability to perform another suitable occupation by virtue of training, education or experience, we are making it clear that a suitable alternative occupation should provide an Income of at least two-thirds of the earnings of a member s insured occupation, to remove the subjectivity that could otherwise surround that.

4 Alternative Occupation Cover therefore becomes Gainful Occupation Cover. 2. Removal of incapacity definitionsObjective Occupation Cover and Abilities Test Cover (referred to in the policy as Definitions D and E)Generic and Combination Cover (used for pay direct cases and referred to in the policy as Definitions F and G)We have reviewed the implications of Objective Occupation Cover and Abilities Test Cover and, because of the possibility that the limitation of benefit payments in some cases to 2 years could be considered discriminatory if offered by an employer, we have decided to withdraw them both from the clarifications we have made to Insured Occupation Cover (known as Definition A) - where we assess a person s ability to perform the duties of their occupation generally, for any employer, rather than for the policyholder specifically - mean that we have been able to reduce the number of definitions available whilst maintaining a clear distinction between cover options available.

5 We are therefore no longer providing Definitions F and definitions will continue to apply until your next rate review when we shall quote on our Insured Occupation Cover basis to replace them. This definition (referred to as Definition A) will then apply from the date the revised quote is accepted. Combined Occupation and Gainful Occupation Cover (referred to in the policy conditions as Definitions B and C) will also be available if advice and a revised quote are essential to make sure that cover meets your needs and to ensure that there is no break in cover. You can of course act sooner and choose a new definition of incapacity before your next review after taking advice from your adviser. Unum Limited 2013 Unum Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

6 Registered in England 983768. We monitor telephone conversations and e-mail communications from time to time for the purposes of training and in the interests of continually improving the quality of service we office: Milton Court Dorking Surrey RH4 3 LZUP3086 11/2013 Page 2 of 2 Tel: 01306 887766 Fax: 01306 8813943) Deductions for Employment and Support AllowanceFor policies on a Net Pay or Fully Integrated basis the age related basic allowance is deducted from the benefit payable by Unum during the 13 week assessment phase. The outcome of the Work Capability Assessment then sets the ESA benefits the member will receive which will be deducted from the benefit payable by Unum. Where the claimant receives ESA Basic and ESA WRAC this will be deducted for a maximum of 39 weeks and thereafter no deduction will be made.

7 Where the claimant is in receipt of ESA Basic and ESA Support this will be deducted for the remaining duration of the claim. For policies on a Gross Pay basis where a deduction for statutory state benefits has been selected, it is deducted regardless of whether it is received by the ) Policy ClarificationsHere are some examples of clarifications we have made. Any changes we are making below should be read while taking into account policy titleSection wording that brings more clarity to the reference that Unum may contact a policyholder s agent where this has been authorised by the Extended Cover* members are entitled to the Free Cover Level.*Eligibility for benefitOur contract has removed any reference to an AIDS/HIV exclusion. Amount of benefitEscalation Rate*: the wording has been simplified to ensure it is clear how escalation is applied to claims in payment.

8 We have also made clear where we will take into account any Income a claimant may receive from other sources in the calculation of the benefit payable, such as pension Income or ongoing earnings or any other benefitA more detailed list of the evidence, both medical and non-medical, which is required to be provided in order to establish our liability in respect of a claim. We have also clarified the circumstances in which benefit payments and TerminationWe have clarified the circumstances in which the policyholder and Unum can make amendments or terminate the Party RightsOnly standard Third Party Rights are now available. These terms give members rights only when pursuing a claim made on their behalf by the ) Continuation OptionUnum is committed to helping bring Income protection to UK employees through the workplace.

9 We believe the workplace is the best place to provide cover because it makes it accessible and more affordable (through Group rates). It is also available to more people than otherwise would be covered through individual therefore stopped offering Individual Income protection in March 2012 and are following this by ceasing to offer a Continuation Option for employees leaving cover will therefore be removed from policies from their next rate review date after 23rd November will deduct state benefits from basic payments as follows13 weeks39 weeksClaim endsGross PayNet Pay/Fully IntegratedESA Basic Allowance ESA (WRAC)*ESA plus Support If chosen, offset always deductedAssessment phase52 weeks0 weeksAssessment phase is definedStatutorysick pay*Work Related Activity Component{Timing.}

10 Our policyholders will only move to the new terms and conditions if their Rate Review Date is after 23rd November 2012 and their Rate Renewal Quotation is produced after 23rd November 2012. Policyholders with Definitions A-C will move to the new terms and conditions from their Rate Review Date. Policyholders with Definitions D-G will move to the new terms and conditions from their Rate Review Date if they accept the Rate Renewal Quotation within three months of the Rate Review Date. If policyholders accept their Rate Renewal Quotation after this date, policyholders will move to the new terms and conditions from the date that they accept their Rate Renewal Quotation. We will also apply the new terms and conditions if there is a request to change the basis of cover after 23rd November 2012 but ahead of the next Rate Review Date that results in a new rate guarantee period being applied.