Proposed new rules to determine insurance payments could affect many critically ill people. The proposal put forward by the Association of British Insurers (ABI), could mean that diagnosis of a condition in itself will no longer be enough to make a successful claim on a critical illness policy.
These changes have been proposed due to medical advances resulting in many conditions being diagnosed earlier and at a younger age. As a result there has been a higher number of claims, especially for cancer.
Currently there are about 12 million individuals in the UK who have critical illness cover but the proposal by ABI to narrow the definitions used to determine payments will lead to fewer people making successful claims in the future.
Duleep Allrajah, senior policy analyst at Macmillan Cancer Relief charity says “Measuring a condition will be difficult because the effects fluctuate so often.” Also
“If cancer patients have to argue their case for a payout, it will add to their stress when they have their health to worry about.”
A spokesman from ABI has said ” This is a consultation exercise. No decisions have yet been taken,” and the association welcomes views from consumer groups, watchdogs, financial advisers and medical experts.
Mike Naylor senior policy adviser from the consumer group Which? Voiced his concern by saying, ” Critical illness cover is widely mis-sold where people do not understand exactly what they are covered for” and ” tweaking with the wording is not going to help the situation, but simply add confusion among consumers.”
The chairman of ABIs critical illness working party has said “these proposal will bring greater clarity to consumers about how the product works and exactly what it does and doesn’t cover.”