He rocked insurers’ boats by claiming that one in five criticalillness policies are invalid.
Insurers and brokers are up in arms, saying he has confused claims that are turned down with policies that are in force. The industry says of one in five claims declined, one in 10 is due to non-disclosure and roughly one in 10 due to the condition not being covered.
This would at the very least mean that Merricks is wrong to extrapolate the figure across policies in force. Some brokers believe that his comments may lead to lapsed policies.
No one is going to argue that critical-illness cover is a perfect product nor that there are no issues for concern. But it should be beholden to all in the market to make sure the right statistics are applied to the right areas.
If Merricks believes he has applied the figures correctly, then he should answer these criticisms urgently.