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The Life Insurance Market

Friday, January 25

New insurance guidelines will benefit consumers @ 09:30 AM

New guidelines issued in January by the ABI (the body that represents insurers) are a big step forward for the industry and should lead to more claims being paid and less declined cases being referred to the Ombudsman for not disclosing important information.

There are now three levels of non-disclosure - ‘Deliberate or without any care’, ‘negligent’ and ‘innocent’. The ABI make clear that an innocent claim should be paid in full and a negligent one should result in a proportionate payout. Deliberate will lead to the claim being declined. Previously, proportionate claims were much more of a grey area without sufficient rules or guidance. This has now been clarified.

This new guidance should stop insurance companies ‘fishing’ for reasons to decline claims. Insurers must now have a specific reason for requesting a claimant’s medical records and must confine a request to information relevant to the claim. This new guidance applies to new and existing policies. -- 1 comments: View - Post your own comment

Posted by simon dunn @ 09:55 PM, January 27

I think this is a great step for the life insurance industry. All too often, not only for life insurance, but critical illness cover to, we hear about policies not paying out. This often seems to be for fairly minor issues, that either the policy holder may have forgotten about, or not even seen as relevant. How can someone in their late fifties or sixties be expected to remember every bit of their medical history? Well hopefully, with this change of stance, not only will more policies be paid out on, which ultimately will ensure more families are left financially protected, but the insurers will not be looked upon with suspicion any more. Bravo the ABI!

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Thursday, January 17

Whatever you do - Don't cancel your Life Insurance @ 02:59 PM

The credit crunch has had a major impact on the Mortgage equity market. As homeowners try to borrow more money against their homes and lenders increase the cost of borrowing, as a result of falling house prices, household finances are becoming a strain for some.

So, what do homeowners with young families do to save money and juggle rising costs and debts? Is it wise to cancel Life Insurance policies and hope the worst doesn’t happen? LifeSearch wouldn’t recommend it, often a new policy will cost more because the older you are the more expensive life insurance becomes, you may also lose out on some benefits and features included in your current policy. If you spoke with a qualified adviser before setting up your life insurance policies then it would be far wiser to keep these and perhaps think of other ways to reduce your outgoings. -- 1 comments: View - Post your own comment

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Tuesday, January 15

Tele-underwriting - cutting down on non-disclosure @ 05:47 PM

Tele-underwriting is an important part of helping to reduce non-disclosure. Tele-underwriters should be trained in empathy and establishing a rapport with the customer and able to go ‘off-script’ when necessary. So if they sense that the client is holding back on answering a certain question, maybe through embarrassment on a sexual health question for example, a tele-underwriter should have enough savvy to return to the question later when a better rapport with the client has been established and remind them of their duty of disclosure.

Ideally insurance companies and IFAs will record telephone calls and tell the customer this is happening. This will act as a deterrent to those who plan to deliberately non-disclose and help to prove where the fault lies in the event that a claim is declined. It also has the benefit of proving when a customer is innocent.

Up-front underwriting is another option in the battle against non-disclosure. LifeSearch are hoping to trial with life offices an option where the customer can choose to pay a small amount extra on their premium to be underwritten up front, thereby effectively ruling out a declined non-disclosure claim. -- 1 comments: View - Post your own comment

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