Summary
The need for precision and candour when writing critical illness insurance policies. This article explains.

Nothing is more disturbing in life than to be diagnosed with a critical or chronic illness. Matters are made a thousand times worse when your insurance company informs you that they will not pay out on your critical illness insurance cover or private medical policy for the Cancer or HIV you are suffering from .

You are asked to peruse sub-clause four of paragraph 328 of the small print, which informs you that you have got the  wrong form of cancer. Only tumours below the hips are covered and only the first six days of your treatment will be paid for, then it is up to you to find the money.

This situation may sound strange, but even though insurers and brokers are regulated, this type of system continues to take place. It has been a time-consuming process to freshen up the industry and to make certain that consumers get a fair deal.

Just recently Cancer Backup, a registered charity, emphasizes this problem by coordinating a huge array of mystery shopping surveys, which exposed some worrying facts about the private medical insurance companies. It found that of most of the leading insurers only HAS provided cover for cancer patients throughout the period of their illness. Only the first part of the treatment is covered by the majority of health insurance companies. Care or treatment over a longperiod of time, such as hormone replacement or chemotherapy is normally excluded.

Although insurance companies and brokers want to finance long term cover for insurance holders with chronic illnesses, they won’t always make it clear to potential clients, at the time of taking out the policy what they are covered for.

While both  Cancer Backup and Macmillan Cancer support have been in consultation with similarestablishments within the industry to raise the standard of sales practices and make the phrasing of insurance documents clearer, progress has been slow since the report was published two years ago.

Private medical insurance and critical illness cover  is usually taken out by clients who are relatively fit and healthy. Getting cancer is the last thing to cross their mind. That is why it is so vital to point out an insurance policy’s exclusions before they sign up.

A testimony of best practice for companies writing and selling medical policies has been modified recently by the  ABI, which is a welcome step in the right direction.

The trade body has now advised that insurers and providers selling these types of insurance should prepare similar case studies, which explicates the conditions when an insurance policy will or won’t be paid. Sadly insurers are not obliged to stick to this code, which is voluntary.

Although the  Association of British Insurers initiative is to be appreciated, the best way of clarifying a policy is by getting the salesperson to explicate the small print.

Nevertheless, industry jargon is in spite of everything even now being used by insurance companies to bewilder the client. For instance it is wrong to categorize cancer as an acute or chronic illness, argues Cancer Backup. On the other hand insurance companies are definite that it should go in the acute group. clients are only told about this when they make a claim.

Even though the ABI have their heart in the right place, the insurance companies can only be made to better their standards by the regulator. Improved training of call centre staff, who sell a greater part of the insurance policies, is also long overdue

More meticulous sales procedures are crucial with jargon being removed. In the end it remains the responsibility of the insurersinsurance companies to ensure that their customers fully comprehend the terms of their policies before they sign the document.

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Tags: cancer, Critical Illness, hiv, illness, Life Insurance

This entry was written by admin and posted on Friday, September 25th, 2009 at 10:56 am and is filed under Critical Illness, Life Insurance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.