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Merricks under attack after he blasts CI on TV

Protection providers have warned Financial Ombudsman Service chief ombudsman Walter Merricks that his outspoken public criticism of critical-illness policies could lead to an increase in lapse rates and leave people without cover.

Merricks sparked outrage in the industry by claiming on BBC1’s Watchdog programme last week that one in five CI policies are invalid.

He said CI cover was one of the key areas of concern for the FOS and UK insurance law is weighted against consumers.

Merricks said: “On the figures we have got, it appears that one in five of the people who have got critical-illness insurance policies may have policies that are actually invalid.”

Providers say this is misleading and the Association of British Insurers has raised the issue with him.

Aegon Scottish Equitable says Merricks’ figures are inflated because around half of the 20 per cent of claims declined are due to conditions not being covered by the policy.

Spokesman Mark Locke says: “Scaremongering on national television with misleading information will turn people away from this type of cover. Equally worryingly, it could actually make people stop paying their premiums on current policies, fearing that they are worthless.”

Le Beau Visage protection expert Peter Le Beau says: “I think when the ombudsman comes out on national television and says this, people will at the very least contact their IFA so it is bound to have a negative effect.”

An ABI spokesman says: “We were surprised by Mr Merricks’ comments and have raised them with him.”

FOS spokesman David Cresswell says: “The figures we quoted were based on the cases we see so there can be no dispute about this. We were not talking about the industry as a whole as we do not have this data.”


Sipps – suit you, sir??

It seems that you can pick up any trade paper just at the moment and self-invested personal pensions will be on or near the front page.

Langridge leaves Invesco Perpetual

Invesco Perpetual fund manager Kathryn Langridge has left the firm to join investment house Lloyd George as chief investment officer.


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