In 2008, over 100 families and individuals a day were helped at the most difficult times in their lives by claiming on their life or critical illness (CI) insurance policies, according to data published today by the ABI. The average claim was £52,000, double the average UK annual salary.
The number of CI insurance claims being paid has risen significantly. In 2008, 90% of CI claims were paid, up from 80% in 2005. This is a result of the success of the ABI Code of Practice on CI Insurance that has led to less claims being declined due to non-disclosure of medical information. To reduce the number of declined claims still further, the ABI is working with its members to tackle the number of claims declined due to not meeting the definition of Total Permanent Disability on a CI policy.
In addition, 97% of term life insurance claims were paid in 2008.
Nick Starling, the ABI’s Director of General Insurance and Health, said: “The insurance industry pays out £5.9m every day in life and critical illness insurance claims, making a real difference to people’s lives at the most difficult of times.
“Insurance companies want to pay all valid claims, which is why the ABI is not complacent and continues to look at ways to reduce the number of claims declined even further.”
“The new ABI code is making a dramatic improvement to the number of critical illness claims we pay. We have been working with the Law Commission so that the principles of our Code are embedded into law.”