Critical illness insurance changes outlined
08 July 2009 12:00:17
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| Main modification will be to total permanent disability. |
According to the organisation, TPD claims often prove problematic for policyholders, with more than half declined by insurers because of a failure to meet the stipulated conditions.
The ABI have suggested removing the TPD clause and replacing it with "carefully worded definitions" to help customers better understand what is and is not covered by the policy.
"We've been in long and detailed discussions with medical experts about the causes of most total permanent disability claims," said Nick Kirwan, ABI assistant director for health and protection.
"As a result, we are confident that the new set of definitions provide clarity and a better understanding about what makes a valid claim."
Bernie Hickman, managing director of protection at Legal & General and chairman of the ABI's Protection Development Committee, agreed that changes were needed.
He added that other proposed measures will help to clarify the distinction between income protection and critical illness insurance, another point of confusion for consumers.
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