A new Protection Committee has been launched to oversee the Association of British Insurers' (ABI) policy development work on critical illness and income protection insurance.
The new Committee, chaired by Nick Kirwan of Scottish Widows, replaces the Critical Illness (CI) Working Group and Income Protection (IP) Working Group.
It aims to improve individuals’ financial security by increasing life, CI and IP insurance coverage of individuals and employers, by:
- Helping to close the protection gap;
- Considering ways to redevelop and promote IP as a key consumer need;
- Considering the gaps and overlaps between different product types;
- Taking an active role in helping to resolve industry reputational and other issues; and
- Working with consumer groups, intermediaries, regulatory authorities and the media.
The committee also has an objective to improve consumer confidence in life, CI and IP insurance products by improving clarity of the products and the insurance/adviser/customer interface. In particular, by:
- Helping to ensure people have the opportunity to make an informed choice about what products they need and can afford;
- Helping to ensure people are clear about what product do and do not cover; and
- Helping to ensure consumers have every opportunity to make full disclosure of relevant information – so they can have peace of mind that when things go wrong their claim will be paid.
The committee will make recommendations for individual and group protection products for life cover, CI and IP insurance and will carry out full reviews of ABI statements of best practice.
It will monitor trends and relevant developments to ensure the statements of best practice continue to meet the needs of stakeholders, including consumers, and it will undertake relevant consumer research.
Further, the Committee will ensure any recommendations are in line with consumer and industry expectations and do not inhibit product innovation to the detriment of consumers.
Members of the Committee are Bob Cheesewright at Friends Provident, Paul Cowman at Prudential, Roger Edwards at Bright Grey, Mark Hews at HSBC Life, Craig Thornton at Swiss Re, Greg Walsh at Bupa and Russ Whitworth at Legal & General.
Nick Kirwan, chairman of the ABI Protection Committee, states: “This move builds on the great work done by the ABI’s Income Protection and Critical Illness Working Parties. Moving to a single Protection Committee will allow us to look at the protection market in a more joined up way – for example, by thinking about the gaps and overlaps between products and how they interact with State and employer benefits.”
Roger Edwards, products director at Bright Grey, believes a single committee has been established because up until now the ABI's work in the protection market has mainly been achieved through the CI Working Party.
He states: "The ABI recognises the problems also affect other areas, such as income protection, so by bringing the expertise across it will result in a consistency of focus and effort."
Although some people consider it is not part of the ABI's remit to legislate about product change, Edwards points out the industry is slow to change and some barriers to selling IP have been around for about 10 years.
He suggests the ABI has realised the industry may need a kickstart to move away from its problems, but warns any proposed changes will need to comply with the Competition Act.
Richard Walsh, the ABI’s head of health insurance, says: “Protection insurance provides peace of mind for millions of individuals and families in the UK. The ABI’s initiatives to enhance consumer understanding by improving information and application forms are already having an impact.”
He claims the new Protection Committee will draw all this work together and the ABI will continue with initiatives to build understanding of the products and the need to disclose all relevant medical facts at the point of application.
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Emily Perryman on 020 7968 4554 or email [email protected].IFAonline
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