Dump the critical illness?

ellie43

I don't recall ever hearing about a claimant who has grossly non disclosed material facts (and thus not held up their end of the contractual agreement) being slated in the same way some insurance companies are.

I agree that it is foolish for claimants not to disclose material facts, and claimants are rightly criticised for this.

But it is often not clear cut sometimes due to poor advice when the policy is taken out. Someone in their 40's taking out a policy is not going to remember every GP visit, and they may not realise the significance of everything they discuss with their GP.

Well that's all for me today - need to go back to bed and rest!:)

dunstonh

I have spoken to staff at the FOS who told me that they used to work for insurance companies and the FOS own websites show that there are ombudsmen who used to work in the insurance industry.
http://www.financial-ombudsman.org.u...ombudsmen.html

Hardly an adequate sample. Its like the reputation that FSA has of being mostly ex bankers and graduates with no financial experience. We can't prove it and it is only based on limited observation and opinion and here say.

Perhaps you would be kind enough to tell me who does regulate the way insurers manage their claims? My financial advisor was unable to assist me on this point.

The FSA regulate it and the FOS rule on complaints within the FSA guidelines, principles and rule books. If a firm has been seen to have consistently poor handling then it will be dealt with.

In my experience the FOS had no interest whatsoever in the way my claim was managed. They make 'recommendations' in some cases but that is all.

Perhaps the FOS decided that there was no mishandling. They frequently award amounts for poor handling of issues and they could have done so in your case if they felt a need.

On BBC Breakfast programme last year an ABI rep was saying how much was paid out a day by insurers and he was asked the amount taken in premiums. The point is relevant because the amount paid out is meaningless if not put in context.

True, the amount paid out is meaningless out of context. So, is the amount paid as well. The likelihood of a claim and the success rates of claims are far more appropriate.

It maybe that most people do not have problems, but for those that do it is a significant issue. If someone wants to make an informed decision it is important that they know what can happen when things go wrong.

Yes it can be a significant issue for the minority in that position. However, its important to remain balanced and not become prejudiced. Cases like yours are not desirable for anyone but they need to placed in the context that they are not the norm. You have every right to complain if you feel a wrong doing has taken place. However, care has to be taken that people do not see that as the norm and then go on to leave themselves with no cover because the minority with issues shout louder than the majority without. We have seen that in the past where someone who may have had an issue or even was just an internet trouble maker has put people off from doing the right thing.

ellie43

1. FOS
I am surprised that you categorise the list of employees and their previous occupations on the FOS website as 'heresay' and 'based on limited observation'.
http://www.financial-ombudsman.org.uk/about/panel-ombudsmen.html

My point is that a claimant who has had problems with their insurer and gets as far as complaining to the FOS is hardly filled with confidence when they discover the person reviewing their complaint was previously employed in the insurance industry.

2. Firms that are consistently poor are not always dealt with via either the FSA or the FOS - see point 4 below

In my case the FOS did rule that there was mishandling and awarded compensation - but it took a great deal persistence on my part to get the FOS to actually read my letters properly and take on board the point I was making. They closed the case down and made a ruling and I had to persist to get them to re-open it as it was clear that they had not understood the issue. When they looked at it again they realised that they had made an error and rapidly ruled in my favour with compensation. Had they shown a genuine interest in the way my case was managed this never would have happened.

3. I agree there has to be an element of balance in all this. But I do not see what I am saying as 'shouting louder'. A rosy picture is often painted regarding financial products through advertising and glossy brochures. Insurers are not going to highlight the problems that can arise, so if I chance across a relevant post, I comment including my experience so that people can make an informed choice.

4. You have said my experience is unusual. For those unfortunate enough to be diagnosed with ME/CFS my experience is not unusual. ME/CFS is classified by both the World Health Organisation and the Dept of Health as a neurological illness and has been described by the Chief Medical Officer as at least as disabling as MS. ME/CFS is twice as common as MS. However, currently there is no diagnostic test and insurers take advantage of this. In 2009 the MEA stated:

The ME Association has become increasingly concerned about feedback from our members regarding the way in which some insurance companies are behaving when it comes to claims for private sickness/disability related benefits – PHI (income protection/replacement) policies in particular.

We do not believe that the NICE guideline on ME/CFS is helping matters, especially the way in which one insurance website has interpreted the outcome of the NICE guideline judicial review to mean that ME/CFS is now classified as a psychiatric illness rather than a physical illness. As a result, it is claimed that insurance companies can opt of making payments to people with ME/CFS where there is a psychiatric illness exclusion clause in the contract. See also our report on the Countess of Mar raising this issue during a House of Lords debate by clicking here.

http://www.meassociation.org.uk/?p=593
http://www.meassociation.org.uk/?p=582

And this neatly brings us back to Unum. In 1995 Unum supported a synposium held in London called 'Occupational Health Issues for Employers'. ME/CFS was described as a 'malingers charter' and Unum's CFS management plan was described as 'Neurosis with a new banner'. Concerns regarding UNUM have been debated in Parliament as far back as 1999, yet problems remain despite the activities of the FOS and FSA.

http://www.publications.parliament.uk/pa/cm199900/cmhansrd/vo991221/halltext/91221h01.htm

I agree that it is vital that people take out adequate insurance. Insurance is expensive and I hope that people will read both sides of discussions such as ours which can bring to light issues that they may not have previously considered.

I will leave this now:)

AlisonHarrison

ellie43 wrote: »

You have said my experience is unusual. I will leave this now:)

Sorry for dredging this old thread up, but I just wanted to say that I do not think your experience is unusual at all.
I had income protection and critical illness with the same insurance company.
At one stage they tried to stop my IP and indicated that I was fit for work. When I made a SAR from them it was clear that they had no evidence to support this. They knew that they had no evidence but the file notes that I received said "......we could say that....."
As you say Ellie this is not an error by one individual, but a systematic attempt by insurers to evade their liabities.
I took it to the ombudsman and won.
When I claimed on the TPD part, they were equally difficult. Again, I obtained file notes, and again, they knew they were wrong but still tried to avoid paying.
Again the ombudsman intervened.
Because of my legal background I was able to negotiate my way through the maze of difficulties, but I am sure that many in my position would have given up.
When I eventually consulted a solicitor about this he told me that my experiences were not unique and this sort of behaviour by ICs is common.

OshayAway

AlisonHarrison wrote: »

Sorry for dredging this old thread up, but I just wanted to say that I do not think your experience is unusual at all.
I had income protection and critical illness with the same insurance company.
At one stage they tried to stop my IP and indicated that I was fit for work. When I made a SAR from them it was clear that they had no evidence to support this. They knew that they had no evidence but the file notes that I received said "......we could say that....."
As you say Ellie this is not an error by one individual, but a systematic attempt by insurers to evade their liabities.
I took it to the ombudsman and won.
When I claimed on the TPD part, they were equally difficult. Again, I obtained file notes, and again, they knew they were wrong but still tried to avoid paying.
Again the ombudsman intervened.
Because of my legal background I was able to negotiate my way through the maze of difficulties, but I am sure that many in my position would have given up.
When I eventually consulted a solicitor about this he told me that my experiences were not unique and this sort of behaviour by ICs is common.

Good to know that you joined the 90% - 93.6% successful critical illness claimants in the end, even though you had some difficulty along the way.

AlisonHarrison

Oshaway, if you read my post properly you will see that I claimed under the TPD part of the policy. Only 45% of these claims are accepted.
Given my own horrific experience and also Ellie's experience it is hardly surprising.
When I spoke to a solicitor who handles these matters he told me that changes were being called for to change definitions so that insurers have less likelihood of being able to wriggle out of the claims.

OshayAway

AlisonHarrison wrote: »

Oshaway, if you read my post properly you will see that I claimed under the TPD part of the policy. Only 45% of these claims are accepted.
Given my own horrific experience and also Ellie's experience it is hardly surprising.
When I spoke to a solicitor who handles these matters he told me that changes were being called for to change definitions so that insurers have less likelihood of being able to wriggle out of the claims.

Absolutely correct, which is why TPD is in the process of being clarified, industry wide... and quite rightly so.
But the bottom line is that although you had problems claiming, your policy did pay out in full. If you didn't take out the plan, you would not have had any chance of claiming at all.

dunstonh

When I spoke to a solicitor who handles these matters he told me that changes were being called for to change definitions so that insurers have less likelihood of being able to wriggle out of the claims.

Strange a solicitor is saying that now. I could agree somewhat if it was some years ago but the changes over the last 18 months make things much more clear cut.

AlisonHarrison

OshayAway wrote: »

But the bottom line is that although you had problems claiming, your policy did pay out in full.

The bottom line is that the IC did not want to pay, refused to pay even though they knew they were incorrect and only paid when the ombudsman told them they had to.
If you read both mine and ellies posts the point we are both trying to make, is that ICs will try to wriggle out of paying through underhand tactics which is a disgrace.
Anyway, I hope everyone else reading the post is able to understand that and take heed from negative experiences we have both had.
It is impossible to say whether insurance is worth it because you do not know what is going to happen.
However, there is no excuse for the behaviour of ICs which, as you rightly said TPD is being looked at.

AlisonHarrison

dunstonh wrote: »

Strange a solicitor is saying that now. I could agree somewhat if it was some years ago but the changes over the last 18 months make things much more clear cut.

The policy I took out was some years ago and did have the unfortunate wording of "any occupation for which you are suited etc etc," So perhaps that is why.
However, it was not just the TPD which they refused to pay, it was the income protection.
Never mind the ombudsman stepped in against them on both occasions.