Insurers Take Steps To Improve Protection Insurance
Most professional financial advisors would agreethat Financial Protection Insurance is extremely important to the majority of families, either as a precaution in the event of premature death, prolonged illness, loss of employment (especially in the present economic climate), or cover for an accident.
Life Insurance Cover 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. Unhappily, a percentage of other Protection Insurance policies, do not have the samedo not have similar} sound qualities and have been branded as being miss-sold. furthermore, based on what we know, critical illness insurance has suffered because of startling exclusions from insurance policies making it feasible for insurance companies to reject many claims, as genuine as they may be.
However, a little confidence was reinstated when Norwich Union gave details on the conclusion of claims on Critical Illness Insurance policies on their half yearly accounts.
Critical Illness claims were being refused because customers did not divulge their full medical history. As a result Legal and General reports that in the last five months the amount of refused claims has dropped considerably from 6.7% in the last year, to 1.5%.
Why? We think, not simply Standard Life but all insurers, because of destructive public relations, have been put into a situation whereby they must reduce the number of claims that are rejected. Does this prove how strong the press can be? Debateable perhaps - you may think we are sceptical but we believe there are other issues that urged the insurance companies to make modifications. A short time ago, as a consequence of |bad press|dire media}, sales of Critical Illness policies have fallen which in turn has noticeably impinged on the insurers profit. This is most likely to have been the vehicle to further change!
Norwich Union, Scottish Provident, Axa and Friends Provident have introduced some major changes specifically created to diminish their rejection rates. To start with, they silhouette clearly that all health disclosure, however minor a visit to a Doctor could have been, must be includedmade known. Scottish Provident, among others will get a medically trained person to telephone every candidate to go through all the particulars of their medical record. If the policy then goes on risk, a number of policyholders are being informed that it is vital that they give complete medical disclosure and they are permitted to add or put right any details on their application form.
The Insurance Company may then re-evaluate the risk and if it is believed to be increased the monthly payments will likely be increased – which looks more reasonable and ultimately more satisfactory than paying the original premium then having a claim rejected as a result of non-disclosure of medical records.
This process should have been taken by the Insurance Companies years ago as the public’s perception of Protection Insurance has eroded by their somewhat ‘Off the ball’ approach. On a positive note, there is a great need for protection insurance so we can hope that it manages to reinstate faith and then the popularity it rightfully deserves.
