The protection provider, which is part of the Royal London Group, said it paid nine in every ten critical illness claims made. The 90% figure represents an improvement of 7% since Bright Grey last published figures in March 2009.
The number of claims rejected for non-disclosure rose to 2.5% from 1.8% however this figure is still down on the 12% recorded in the year 2007/08.
This increase is in line with industry figures which have shown that record levels of critical illness (CI) insurance claims were paid out in 2008. Legal and General paid out 93% of claims (up from 88%) while Zurich and AEGON Scottish Equitable paid out 91%, a significant increase on 2008 for both companies. In 2007 Zurich paid 88% and AEGON 82%.
Providers have attributed the increases to the implementation of the Association of British Insurers’ (ABI) guidance on non-disclosure, which has also halved the number of protection complaints going to the Financial Ombudsman Service (FOS).
Of the 13.89% critical illness claims turned down by Bupa just 1.79% were due to non- disclosure, down from 8.6% last year. Zurich turned down just 0.4% for non-disclosure down from 3%. AXA turned down 8% for non-disclosure, but reported that none were declined where the application had been teleunderwritten.
The ABI is currently undertaking further work in order to improve clarity and understanding amongst both customers and advisers so that this trend can continue.
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