View more on these topics

How do we kick non-disclosure to the kerb?

Non-disclosure remains a hot topic in the protection industry, and I suppose it will do until someone stubs it out.

Protection gurus are putting forward ideas, albeit not at a rate of knots, on how exactly to slaughter the beast. No obvious answer has been unearthed so far but any brainstorming has got to be positive.

Lifesearch has been throwing around the idea of a guaranteed product, a protection policy which, for a little bit more dosh to cover intensive underwriting, would definitely pay out – unless the policyholder was fraudulent.

One side of the fence believes such a product would sell like hotcakes as consumers, wary of the industry, would feel at ease knowing the insurer could not refuse their claim for a heart attack, if they had forgotten to mention an ingrown toenail on their left foot or an ear ache or a dislocated shoulder and so on.

But the other side feels a guaranteed product would make every non-guaranteed product on the market look like a gamble. Why not just fix the current products so they all pay out – isn¹t that what they¹re supposed to do anyway?

Either way the idea is moving forward with Norwich Union last week letting slip it was testing the concept of a guaranteed product with customers on its online forum. No results as yet but I¹ll keep you posted.

Another suggestion on how to kill-off the non-disclosure plaguing the industry involves submitting a client¹s medical records to the insurer alongside their application, with a note saying please refer to my records when underwriting.

Both concepts require more extensive medical evidence at application but the latter is a procedural change rather than a new product and could therefore, in theory, be used for all products across all insurers. This would allow interested consumers to pick from the whole of market rather than choosing NU¹s policy because it¹s the only one on offer.

Admin staff rather than doctors prepare copies of medical records so GPs wouldn’t waste their time with printers and photocopiers. But the underwriter¹s workload will inevitably soar and some insurers will be tempted to whack up premiums to cover this extra cost.

But it is essentially treating customers fairly, is it not, to go through a customers medical records if they are not confident they can provide the correct answers? And can insurers put the cost of premiums up for simply toeing the TCF line? I don¹t know, but the intense price competition the industry has got used to will probably drive them down again within a few weeks anyway.

Let me know what you think about either of these ideas or if you have any new theories on how to do away with non-disclosure please get in touch.


Premiums set to rise amid tax crackdown on insurers

Protection experts are concerned that removing tax relief on reinsured business could see insurance premiums jump by 3 to 4 per cent.The proposals outlined in the pre-Budget report aim to close a tax loophole for insurers but could have serious implications for consumers.Insurers currently receive tax relief on expenses they incur in respect of reinsured […]

The way forward

The distribution sector has a crucial role to play in encouraging people to save for the future, says Tenet chief executive Simon Hudson

Boutique fund launchesneed IFA support

SVM head of retail sales Mark Noble believes it is crucial for new boutique fund launches to get endorsement from adviser firms and multi-managers if they are to get through their initial phase of asset gathering.Noble said at the roundtable debate that while bigger companies may be able to seed funds, boutique firms really needed […]


Almost nine in 10 employers admit failings with post-DRA compliance

The default retirement age (DRA) was abolished more than three years ago, yet new research from Jelf Employee Benefits suggests that the vast majority of employers still have some way to go to fully understand, comply and communicate the landmark legislation change that prevents older employees being forcibly retired on the grounds of age alone.


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm