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Prudent course would be a U-turn

The Pru needs to get a plan for itself that involves treating its customers properly.

Financial services companies operate in an environment that is over-regulated and plagued by Government meddling while firms are expected to turn a profit from products that have a fundamental impact on people&#39s lives.

There are almost always good reasons to get insured, to save, regardless of the asset involved and to shop around for a mortgage.

Things will inevitably go wrong and, in these instances, Money Marketing will often give these companies the benefit of the doubt. In the case of the Prudential protection fiasco, there is no doubt.

There is no justification for the take it or leave it attitude and no PR gloss can be put on their decision.

The new terms applying to applicants for critical-illness cover are unjustifiable from a company of such supposed stature. It is not their customers&#39 fault that Pru&#39s creaky admin system meant that their claims were not processed in time. It is the Pru&#39s fault.

We suspect the Pru may believe that in this new ruthless environment where profit is everything and insurers are no longer some sort of unofficial wing of the welfare state that its decision was justified.

It may even believe the decision is a brave one. But for a company that spent £20m on advertising to help re-establish itself as the foremost financial services brand it has profoundly underestimated just how bad a decision this is.

Money Marketing suggests Prudential honours these applications. This would stop the damage to their customers, damage to the IFAs that recommended Pru, and damage to the Pru itself. The only prudent thing to do is to reverse this decision.

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