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NU pays 80m on critical cover but refuses 23% claims

Norwich Union paid out over 80m for claims on critical-illness policies last year, representing an increase of 23 per cent on claims paid in 2004.

The declinature rate was 23 per cent, with 12 per cent of claims turned down due to non-disclosure and 11 per cent due to policy conditions not being met.

The refusal rate showed a fall from the previous year when it was 26 per cent, with 13 per cent due to non -disclosure and 13 per cent to criteria not metThe company paid out on a total of 1,123 claims last year with an average payout of 73,000. At the point of claim, a typical policy had been in place for less than four years.

Cancer was the dominant cause of payout at 68 per cent, with 8 per cent for heart attacks, 6.9 per cent for multiple sclerosis and 5.6 per cent for strokes.

Almost nine times more men claimed for heart attacks than women while twice as many women claimed for MS.

Head of protection products Louise Colley says: “Norwich Union is striving to find new ways to reduce the levels of non-disclosure in policy documents.

“Earlier this year, we introduced a full disclosure factsheet in all our information packs further underlining the importance of completing forms carefully, accurately and completely.”

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