Insurers Enhance Protection Insurance
A lot of specialist financial advisors would be of the same opinionthat Financial Protection Insurance is fundamental to the majority of families, whether it may be 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 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 types, do not do not have equivalentdo not have similar} reliable qualities and have been branded as being miss-sold. Also, based on what we know, critical illness insurance has suffered owing to 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 1/2 yearly figures.
Critical Illness Insurance claims were being turned down because clients did not divulge their full medical background. As a result Standard Life reports that in the last seven months the amount of turned down claims has plunged significantly from 6.8 per cent in the previous year, to 1.5%.
Why? We think, not simply Norwich Union but all insurers, because of negative public relations, have been put into a situation whereby they must diminish the amount of claims that are rejected. Does this prove how forceful the press can be? Debateable perhaps – you may think we are sceptical but we think there are other factors that urged the insurance companies to make adjustments. Lately, as a result of |bad press|dire media}, sales of Critical Illness Insurance policies have declined which in turn has obviously influenced the insurers profit. This was probably the catalyst that promoted the change!
Axa, Friends Provident, Norwich Union and Scottish Provident have instigated some prominent changes expressly designed to decrease their rejection rates. To start with, they outline plainly that all medical disclosure, however minor a visit to a Doctor might have been, must be revealed. Friends Provident, among others will get a medically trained person to phone every applicant to go through all the particulars of their medical record. If the insurance policy then goes on risk, a number of policyholders are being told that it is essential that they provide complete medical disclosure and they are permitted to add or correct any details on their application.
The Insurance Company may then re-evaluate the risk and if it is believed to be increased the monthly premium will probably be raised – which seems more rational and ultimately more satisfactory than paying the original premium then having a claim rejected as a result of non-disclosure of health facts.
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 a clear and necessary need for protection insurance so we can hope that it manages to restore faith and then the popularity it duly deserves.
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