Critical illness insurance problems of disclosure
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Transcript of Critical illness insurance problems of disclosure
![Page 1: Critical illness insurance problems of disclosure](https://reader033.fdocuments.in/reader033/viewer/2022052622/5596a27e1a28ab624b8b45aa/html5/thumbnails/1.jpg)
Critical illness insurance-problems of disclosure?
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Statistics in the last decade state that 1 in 3 people in Britain will be
diagnosed with cancer at some stage in their life.
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Although continual ongoing medical research means the chances of survival are higher the threat of
suffering from such an illness is still very apparent.
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Almost 55% of claims made on critical illness insurance were cancer based and medics believe this is set
to continue.
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In this eventuality critical illness cover can offer the financial security
you need.
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However non co-operation from insurance companies seems to be becoming an increasingly common
problem.
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Before your insurance company will make a pay out they have to go
through vigorous checks on all the information and medical history you
supplied.
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Although in your application to make a claim you will have told
them this information, insurers will now insist that this is rechecked.
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For example if you state that you were a non-smoker when you made the claim, your insurance provider
will need conformation of this from your doctor.
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The main reason for this process is the problem of non-disclosure.
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As the title suggest, non-disclosure is where the insurance company
believes the applicant has withheld factual information, whether
inadvertently or not.
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Insurers defend this procedure stating that, failure to disclose
information when you first applied for the policy may have affected whether or not you would have
been initially refused cover.
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Non-disclosure is therefore seen as a way of cheating the system and
insurers see this as a valid reason for refusing an insurance claim.
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Additionally insurers are particularly distrustful of those making a claim
within the first 5 years of the policy.
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Any claim within this period is seen as an “early claim” and insurers
often believe the policy holder took out the insurance with the
knowledge they were already ill.
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However this intense scrutiny is now creating the problem of bas
press.
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Ultimately even if a piece of information is found that had
nothing to do with the illness you claimed for, your claim will still be
refused.
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However larger insurance companies are being seen to try and
remedy these problems.
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In the last year the insurance giant, Aviva had a “moratorium period”, whereby customers could come
forward and present new information they had failed to
disclose origionally; without any negative affects on their policy.
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In addition to this major insurance companies advertise regulalry that 85-90% of claims are successful and
the payouts the make each year runs into millions and millions of
pounds.
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Even if a failure to disclose was inadvertant this may still affect your
claim, applicants must therefore insure they don’t withhold anything
before going ahead.
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Customers should therefore seek expert independent advice before
applying for critical illness insurance.
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Critical illness insurance-problems of disclosure?