The power of cover upgrades: demonstrating real benefits for existing clients

Written by Jo Penrose, Head of Proposition, at Guardian 

Treating existing customers fairly can sometimes feel like something companies pay lip service to, rather than taking action. I think most people will agree it can be annoying when you’ve been a loyal customer for years, but the best offers are only available for new customers.  

In the protection space, this discrepancy – between what companies offer existing customers and what they offer new customers – is vitally important. This is because the definitions customers buy with their critical illness policy determine whether it will pay out when they need it most.  

Is it fair that only new customers get the best definitions?  

When thinking about the answer to this question, most people would intuitively argue no, but it’s a practice that persists in the protection industry. That is, apart from at Guardian, where we take a different approach. With our critical illness cover, both new and existing customers can benefit from critical illness definition improvements because of our unique cover upgrade promise.  

We talk a lot about this promise and for good reason. It’s not just a nice idea, it’s something we believe in, and 2 recent claims are proof of this.  

Before we go into the detail, for those not familiar with our cover upgrade promise, it’s useful to share a bit of background. Cover upgrade is our promise to policyholders that if we improve our critical illness definitions for new policyholders, we’ll give those improved definitions to them as an existing policyholder, usually for free. 

The cover upgrade promise in practice 

What it means in practice is that existing policyholders can claim on any of the definitions listed in their policy terms and conditions, as well as any existing definitions we have improved or any new definitions we have added. This applies to both full payout and additional payout definitions. To make it easy for customers to check what they’re covered for, all the current and past definitions are clearly laid out in our newly developed cover upgrade promise checker tool.  

Since our launch in 2018, we’ve made a handful of cover upgrades and paid our first cover upgrade claim in 2023 for Parkinson’s, which is a definition we improved in October 2019. At the time, the improvement meant the definition changed from: “There must be permanent clinical impairment of motor function with associated tremor and rigidity of movement”, to “There must be permanent clinical impairment of motor function. This impairment should include either an associated tremor or muscle rigidity. 

For the claim we paid in 2023, the policyholder had been diagnosed with Parkinson’s after an associated tremor, however, he wasn’t yet experiencing muscle rigidity. His claim wouldn’t have met the original definition in his policy terms and conditions. However, because of our cover upgrade promise, we could assess his claim against the improved Parkinson’s definition and were able to pay the claim. 

As this claim shows, it’s a promise that can make a big difference to outcomes. And our biggest cover upgrade came in April this year. Across both adult and children’s critical illness cover, we added 5 new definitions, improved 24 definitions, and made 16 neutral wording changes and 3 clarifications for increased certainty. Best of all, just 3 months on, we’ve already paid 2 surgery claims under the improved definitions. That’s 2 families who didn’t have to wait for treatment to get the financial support they needed.  

The surgery definition change and why it was made 

Before April 2025, under our Surgery Cover definition we paid out 25% of the cover amount when the policyholder was placed on the NHS waiting list. But with NHS waiting times growing, we felt that wasn’t working for customers. People were being diagnosed, placed on a waiting list, and left waiting for their full payout. We also know from CIExpert’s Critical Thinking Report 2024, customers want to use their pay out to support treatment, with 29% of consumers saying they’d use a critical illness payout to either partially or fully pay for private medical treatment, and 29% said they’d spend it on things to improve their health and wellbeing.¹    

So, we changed that definition. Now, for 14 serious conditions – including open-heart surgery, major organ transplant, and benign brain tumour – we pay the full cover amount as soon as the customer is placed on the NHS waiting list. Alongside, we also added 2 new additional payment conditions: lobectomy and angioplasty. 

It’s a seemingly simple change. But it makes a big difference. As of May 2025, the NHS waiting list for consultant-led hospital treatment in England stood at 7.36 million. Nearly 197,000 people have been waiting over a year for treatment, and this has increased on the previous month’s 190,000. What’s more, the Government’s revised 2025/6 elective 18-week target is now 65%.² These are not just statistics. They show the reality for thousands of families waiting for surgery.  

The claims we could now pay 

Just a few weeks after making our cover upgrade, in May we received a claim for a child diagnosed with an atrial septal defect. The child needed open-heart surgery, not possible by keyhole, and had been placed on the waiting list in March. Under our old definition, the family would have had to wait until the surgery was completed. But thanks to this upgrade, we could pay the £25,000 children’s critical illness cover in early July, giving the family financial breathing room at a time they needed it most. 

In another case, a customer was referred for angioplasty after chest pain and an MRI. They were placed on the waiting list in March and had their operation in late April. Because of the upgrade, we were able to pay the additional cover payout amount 5 days earlier than we would have under the old terms. While, in this case, it’s a small-time difference, it’s still a big signal of our intent. And of course, as this was an additional cover payout, this policyholder still has their full cover amount in place, if they were to make another claim.  

These claims clearly demonstrate the importance of our cover upgrade promise. We’re proud to have pioneered this innovation. In our view, it plays a fundamental role in improving outcomes and growing trust in our industry, which is something that all advisers (and other providers) will benefit from.