Scottish Provident has continued the trend of publishing details of unpaid critical illness claims within its latest claims data. The company is following a recent trend, first started by Standard Life, to publish details of unpaid claims for greater consumer awareness.
Of 929 total claims, 801, or 86% were paid and 128, or 14% were turned down. The company believe that it is essential for the financial industry to be seen as being transparent by advisers and their clients, and by publishing this information, it allows the industry to provide benchmark data, assess emerging trends and design products to meet what people want.
Their figures showed that payouts were on average £74,000, with the average age of claimants being 42. Of the 128 declined claims, 52% were turned down because the claimant had not disclosed material information when they took the policy out.
Pressure is being put on the Financial Services Authority to require information-only sales of protection insurance to include risk warnings for customers. Consumer groups and protection advisers have repeated calls for non-advised, information only sales of term assurance and critical illness cover to be accompanied by warnings that customers will not have a way out of the policy through the Financial Ombudsman Service if they buy the wrong policy.
They have now been joined by the national press in their campaign for consumers to be made aware of the consequences of buying without advice.
Our view
It is commendable that providers are trying to promote consumer awareness. Critical Illness is an extremely important area of protection and we should all consider at least some cover. Compare costs and companies online now.