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Standard dismayed at 14% claim refusal rate

Standard Life paid out 9.8m in critical-illness claims in the first half of this year and says it was disappointed that 14 per cent of claims were declined.

Six per cent of claims were declined because the claim did not meet policy definitions and 8 per cent were declined due to non-disclosure.

At point of claim, 60 per cent of policies had been in place for more than four years.

Sixty per cent of claims paid were for cancer followed by 11 per cent for heart attacks and 8 per cent for multiple sclerosis. The biggest claim paid was 300,000.

Sixty per cent of claimants were aged between 40 and 59 while claimants aged 39 and under accounted for 32 per cent of claims.

Protection marketing manager Mick James says: “Critical-illness policies continue to play an important role as part of consumers overall protection needs. These policies are designed to pay out in the event of life-changing events and, in the majority of cases, they do just that.

“However, the level of declined claims is disappointing. Hopefully, the work of the ABI, through the statement of best practice, will help to reduce the number of declined claims and start to rebuild trust in an industry which strangely enough does not like to decline claims.”

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