Insurers Enhance Protection Insurance
Most trained advisors would be of the same opinionthat Protection Insurance is vital to a good number of families, either as a safeguard in the event of premature death, prolonged illness, loss of employment (especially in the present economic climate), or cover for an accident.
Life Insurance Policies is the foundation of all financial assurance for cover for a mortgage or to ensure a lump sum that is not taxable, in the eventuality of death. Sadly, a percentage of other Protection Insurance policies, do not have the samedo not have similar} reputable qualities and have been labelled as being miss-sold. Also, based on what we know, critical illness insurance has suffered because of astonishing exclusions from insurance policies making it feasible for insurers to reject many claims, as genuine as they may be.
However, some confidence was restored when Standard Life reported on the conclusion of claims on Critical Illness Insurance policies on their half yearly statistics.
Critical Illness Insurance claims were being rejected because people did not reveal their complete medical record. As a result Legal and General reports that in the last 5 months the amount of rejected claims has dropped substantially from 6.8 per cent in the last year, to 2.3%.
Why? We think, not simply Aviva but all insurers, because of destructive public relations, have been placed in a position whereby they must diminish the number of claims that are rejected. Does this prove how powerful the media can be? Debateable perhaps – you may think we are sceptical but we think there are other factors that encouraged the insurance companies to make changes. More recently, as a consequence of |bad press|dire media}, sales of Critical Illness policies have declined which in turn has visibly influenced the insurance company’s profit. This is most likely to have been the vehicle to further change!
Norwich Union, Scottish Provident, Axa and Friends Provident have initiated some important alterations specially designed to reduce their rejection rates. To begin with, they outline plainly that all health disclosure, however trivial a visit to a Doctor may have been, must be includedmade known. Axa, together with others will get a medically trained person to telephone every applicant to discuss all the details of their medical history. If the insurance policy then goes on risk, some policyholders are being reminded that it is essential that they give complete medical disclosure and they are permitted to add or put right any details on their application document.
The Insurance Company may then re-assess the risk and if it is thought to be increased the monthly premium will most likely be raised – which seems more reasonable and ultimately more satisfactory than paying the original premium then having a claim rejected due to non-disclosure of medical information.
This process should have been put into operation by the insurers years ago as the public’s understanding of Protection Insurance has deteriorated by their somewhat eccentric approach. Without doubt, there is an obvious and essential need for protection insurance so we can hope that it manages to reinstate faith and then the esteem it justly warrants.
This entry was posted on Monday, August 31st, 2009 at 11:44 am and is filed under General. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.