Standard Life cut the number of critical illness claims declined in 2006 by more than half compared to 2005, following improved questions and additional warnings on forms, claims the insurer.
It says in 2006 it rejected 7.5% of claims, 3.3% of which were because the claim did not meet the policy definition – down from 10% in 2005 – while 4.2% of claims were dismissed because of non-disclosure.
In these cases it says where a claim has been declined because it does not meet policy definitions it is because a customer has tried to claim for an illness or condition which is not covered by their policy – including customers who have asked whether their policy will cover a diagnosed medical condition in case they may qualify.
And where Standard Life has declined a claim because of non-disclosure, it says this occurs when a customer has not made a full disclosure of their medical history at the time of application.
However, in the statistics released today Standard Life says it paid out 350 claims worth £18.7m, with an average payout of £52,138, although the biggest claim was for £500,000, with 53% of claims made by women, compared to just 47% by men.
Standard Life reveals over the last year 64% of claimants were aged between 40 and 59, while 33% were aged under 39 and 3% of claims were made by people over 60, with 72% of policies used to make a claim having been ‘in force’ for more than four years.
And the insurer says the biggest cause of claims during 2006 was cancer with 60%, while the rest of the top five included heart attacks which accounted for 11% of claims, multiple sclerosis represented 8%, 4% of claims were stroke related, 3% had benign brain tumours and 14% of claims had other causes.
Mick James, protection marketing manager at Standard Life, says there is often a stigma associated with Critical Illness plans on the assumption they don't pay out, but he argues in 2006 Standard paid over 90% of customer claims.
He adds: “While there has been a dramatic reduction in the number of declined claims in 2006, it is too early to say whether this is a trend. Our work to improve the questions being asked on application forms and the additional warnings highlighting the need for full disclosure by customers is starting to reap benefits in fewer claims being declined.”
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