May 9th, 2009
Much has been written about Critical Illness (CI) products over the past couple of years. This has highlighted both negatives and positives about the complicated type of insurance cover. Research has shown there is a lack of trust in some of claim processes and procedures that are creeping in. Even more concerning is the concern that insurers aim not to pay these costly claims if it is at all possible. This has been reinforced by a claims statistics being widely available that are not 100 per cent comparable.
The insurance industry as a whole needs to educate customers not just about the products, but also around processes and procedures of making a claim on these policies. Standard Life declined to pay 14 per cent of critical illness claims in the first half of 2006, according to its claims statistics. In the first half of 2006, 6 per cent of claims were declined because the claim did not meet policy definitions and 8 per cent were declined because of non-disclosure. Overall, Standard Life paid out £9.8 million in 184 CI claims with an average claim value of £53,546. The largest claim paid was £300,000. Standard Life Assurance protection marketing manager said: “The level of declined claims is disappointing. Hopefully, the work of the Association of British Insurers (ABI), through the Statement of Best Practice, will help reduce the number of declined …