Friends Life discloses income protection claims figures and calls for consensus on disclosure

 

Friends Life has announced its income protection claims statistics for the first time, but is continuing to call for the industry to work with the ABI towards a consistent basis on which insurance firms disclose this information in the future. The insurer believes that without a consistent basis the data could be misleading for both advisers and consumers. Friends Life paid out 87% of all new income protection claims in 2012, having received 497 claims. Of these, 45 (9%) were declined because the medical definition was not met, with 18 (4%) declined due to non-disclosure.

Over 2,300 income protection customers received payouts from their policies, with Friends Life paying out a total of £21m to its income protection customers.

During 2012 1,553 new and existing claims were reviewed and 96% continued to receive payments.

However, Friends Life remains concerned about the way in which the industry discloses income protection claim statistics. Different opinions of what constitutes a claim, the definition of a declined claim and general confusion regarding the recording of claims data make the process complicated and the figures ambiguous, the insurer believes.

Chris Pollard, Head of Underwriting, Claims and Operations for Friends Life Individual Protection, commented “We have listened to the market sentiment and are happy to reveal that, in 2012, we paid out 87% of income protection claims. However, we remain concerned there is no consistent basis on which the industry discloses its income protection claims statistics other than via the ABI. Disclosure and transparency are positive things for the industry, but we strongly believe that the figures themselves need to be meaningful so as not to lead to incorrect conclusions.”

Friends Life will continue to lobby for a consistent basis for disclosure to ensure that, in 2014, each provider reports on the same basis and in line with a structure agreed through the ABI.

 
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