Insurance Companies Take Steps To Make Protection Insurance Better
A lot of professional advisors would agreethat Protection Insurance is crutial to a good number 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 is the foundation of all financial assurance to ensure a lump sum that is not taxable, in the event of a death or for cover for a mortgage. Sadly, a proportion of other Protection Insurance types, do not do not have equivalentdo not have similar} reputable qualities and have been branded as being miss-sold. furthermore, based on what we know, critical illness cover has suffered owing to shocking omissions from insurance policies making it feasible for insurance companies to reject claims even when they are genuine.
However, a little faith was reinstated when Norwich Union gave details on the conclusion of claims on Critical Illness policies on their 1/2 yearly statistics.
Critical Illness claims were being declined because people did not make known their complete medical background. As a result Standard Life says that in the last seven months the amount of turned down claims has reduced considerably from 6.8 per cent in the last year, to 2.3 per cent.
Why? We think, not only Aviva but all insurance companies, because of harmful publicity, have been placed in a position whereby they must diminish the number of claims that are rejected. Does this prove how strong the press can be? Debateable perhaps – you may think we are doubtful but we believe there are other factors that encouraged the insurance companies to make changes. More recently, as a result of |bad press|dire media}, sales of Critical Illness Cover have dropped which in turn has clearly influenced 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 specially designed to reduce their rejection rates. Firstly, they outline clearly that all medical disclosure, however insignificant a visit to a Doctor could have been, must be includedmade known. Friends Provident, together with others will get a Doctor or Nurse to telephone every applicant to go through all the details of their medical history. If the policy then goes on risk, a number of policyholders are being told that it is essential that they give full health 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 believed to be increased the monthly payments will most likely be raised – which appears more sensible and eventually more satisfactory than paying the original premium then having a claim rejected due to non-disclosure of medical facts.
These measures should have been applied by the Insurance Companies a long time ago as the public’s understanding of Protection Insurance has eroded by their somewhat strange approach. Without doubt, there is a clear and necessary need for protection insurance so we can hope that it manages to reinstate faith and then the recognition it justly merits.
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