Critical illness insurance-problems of disclosure?

Statistics in the last decade state that 1 in 3 people in Britain will be

diagnosed with cancer at some stage in their life.

Although continual ongoing medical research means the chances of survival are higher the threat of

suffering from such an illness is still very apparent.

Almost 55% of claims made on critical illness insurance were cancer based and medics believe this is set

to continue.

In this eventuality critical illness cover can offer the financial security

you need.

However non co-operation from insurance companies seems to be becoming an increasingly common

problem.

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.

Although in your application to make a claim you will have told

them this information, insurers will now insist that this is rechecked.

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.

The main reason for this process is the problem of non-disclosure.

As the title suggest, non-disclosure is where the insurance company

believes the applicant has withheld factual information, whether

inadvertently or not.

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.

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.

Additionally insurers are particularly distrustful of those making a claim

within the first 5 years of the policy.

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.

However this intense scrutiny is now creating the problem of bas

press.

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.

However larger insurance companies are being seen to try and

remedy these problems.

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.

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.

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.

Customers should therefore seek expert independent advice before

applying for critical illness insurance.

Critical illness insurance-problems of disclosure?