What does 'cessation age' mean?

In insurance, the term ‘cessation age’ refers to your age when your policy will end i.e. your cover will stop. FMI offers four cessation ages on our BPE policy and your chosen age is shown on your policy schedule.

When applying for a BPE policy, you can choose from four cessation ages (the age of the Life Insured at which the policy will end). These ages are 55, 60, 65, and 70. These different choices allow you to customise your policy according to your needs.

Your BPE policy will cancel on the policy anniversary following your chosen cessation age.

How does entry age come into it?
The maximum entry age is the oldest age that an applicant can be when they take out a BPE policy. For BPE, the maximum entry age depends on the cessation age chosen. The maximum entry ages are:

• For cessation age 55, the maximum entry age is 51 Age Next Birthday
• For cessation age 60, the maximum entry age is 56 Age Next Birthday
• For cessation age 65, or 70 the maximum entry age is 61 Age Next Birthday
• For cessation age 70, the maximum entry age is 66 Age Next Birthday

Need to continue your cover?
AT FMI, we know that self-employed people and business professionals have different needs to salaried individuals. They might need to work for longer than the normal retirement age of 70 and will, therefore, will need their cover to continue. We also know that it is difficult to predict in advance at what age you will definitely retire. You may need to work to establish further retirement savings.

As the Life Insured on BPE, if you have chosen a cessation age of 55, 60, or 65, you have the option of extending your cover for a further 5 years on attainment of the original cessation age by taking advantage of FMI’s Continuation Benefit.

If you wish to continue working once your policy reaches cessation age, you would normally need to apply for an extension to the original policy or for a new policy to keep enjoying your cover. There are two problems with following either of these options:

• Applying for an extension to the original policy or applying for a new policy will result in further underwriting. While you may be healthy now, at an older age you might have health issues. And, Underwriting requirements are linked to age, so at older ages the standard Underwriting requirements are likely to be quite detailed. This might result in the insurer placing exclusions on the claim events that you are most likely to suffer, loading your premium, or even declining further cover.
• If you, as the Life Insured, are older than the maximum entry age, you will not be able to apply for a new policy.

That is why we have automatically included the Continuation Benefit as an additional benefit on our BPE offering. In order to exercise this option, you will need to submit a satisfactory Declaration of Health, a far less onerous requirement than being fully medically underwritten at that age. The Continuation Benefit can also be exercised multiple times. So, if your original retirement age was 55, you can extend cover to age 60, at age 60 extend cover to age 65, and then at age 65, extend cover to age 70.

Please note that you need to notify FMI 3 months before you reach your original retirement age if you intend to exercise your Continuation Benefit. Cover cannot be extended beyond age 70 and terms and conditions apply.

Do you have a Vision or Express Income Policy? Different cessation ages and terms and conditions apply. Visit our website (fmiwp) or contact Client Services on 0860 10 11 19 to learn more.