Insurance Industry can perhaps make things clearer re questions asked?

Annemos

(A post just disappeared about the questions we are asked when taking out a policy. And when policyholders do not disclose information.)


With Insurance policies, we are applying on-line, on the telephone etc. Different things are going on as we take out a policy. (Misunderstandings and omissions can presumably occur. Then, was that deliberately or not etc.?) 

We are then sent various documents when we purchase the policy. (A lot of information is in them.)

One of these documents is the  "Insurance Product Information Document"  IPID   (Quote: This document provides a summary of the key information relating to this insurance policy. You can find all of the pre-contractual and contractual information on the product in the full policy documentation. This policy meets the demands and needs of customers that wish to cover their home and possessions against loss or damage.)     This one has been designed to be user-friendly I would say. It is laid out well, with key facts. 

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Here is my wish. As I am not an expert, I do not know if it is viable, as a suggestion, for the Insurance Industry: 

Could another standardised type of document like the IPID be generated for each policy type, to show exactly which critical questions have been asked for this policy version? It might be called a "Key Disclosure Requirement Document"  KDRD

I am not an expert, but I am thinking that this KDRD, could contain the exact wording that has been asked, for each policy type. It could clearly state what CRITICAL Disclosure information questions, we have had to answer, when taking out the policy. For example, this might be: 

Question about claims in the past
Question about cracking/movement
Question about previous flooding
Question about any Court Judgements against policyholder and/or other people in the home etc. 
Question about being resident in the UK. 

There may be more. 

Such a form might emphasise how important this issue is   .... and in an easier format? Thanks for reading. 

DullGreyGuy

Whilst some questions may have different weightings in terms of the scale of impact on the premium and some may be a binary decline/proceed the reality is CIDRA doesn't differentiate between a critical question and a minor one. The other issue, with the advent of machine learning, pricing for high volume business like Home and Motor is getting delegated to scripts and in reality almost any question can become critical... an insurer may expect to win 10% of the quotes it gives, if the bot spots that for detached houses they are selling 100% of quotes then it'll push the price, if it stays at 100% then it'll put the breaks on and stop quoting detached property and flag for someone to look at it. Arguably, for the next hour or however long it takes, if a property is detached, semi, terrace etc suddenly becomes a critical question given it can lead to a decline. When an underwriter then spots an error in the script meaning that it was giving a 90% discount when it was supposed to be a 10% discount the pricing is corrected, system is allowed to quote detached property again, probably no longer a critical question. 


 Ultimately you need to be able to answer all questions, other than when is the renewal date of your other products, honestly else risk the consequences under CIDRA. A quick trip to Confused.com or another aggregator will give you 99% of the questions asked for a certain class of business (by the nature of how the sites work). Some insurers will ask less questions and a tiny number may have something left field that they haven't convinced the aggregators to include. 

Realistically most people should be able to answer questions like how many bathrooms their house has without a pre-prepared cheatsheet of questions. The ones that people tend more to struggle with are anything date driven (how many claims in the last 5 years, how long you owned your vehicle etc) and unfortunately, especially those buying from certain brokers, people tend to guesstimate rather than take the time to check their V5 or look at the schedule of their renewal quote. Hence my comment on the now disappeared thread... the news needs to be the importance of accurate answering not how evil are insurers that apply the CIDRA legislation. 

Annemos

Many thanks DGG for your detailed reply, on behalf of us all.