Summary
The need for clarity and honesty when writing critical illness insurance policies. Read this article to understand.

Nothing is more disturbing in life than to be diagnosed with a serious or severe condition. Matters are made a thousand times worse when your insurer tells you that they will not pay out on your critical illness cover or private health insurance for the Cancer or HIV you are suffering from .

You are told to peruse sub-clause four of paragraph 325 of the small print, which informs you that you have got the  wrong type of cancer. Only tumours below the knee are covered and only the first five days of your treatment will be paid for, then it is up to you to find the money.

This situation may sound absurd, but even though insurers and brokers are regulated, this type of procedure continues togo on. It has been a long drawn process to clean up the industry and to ensure consumers get a proper deal.

A short time ago Cancer Backup, a well known charity, emphasizes this problem by arranging a wide ranging mystery shopping surveys, which exposed some disturbing facts about the private health insurance companies. It discovered that of nearly all the leading insurers only PPP gave cover for cancer patients throughout the period of their illness. Only  the initial treatment is covered by most of the health insurance companies. Care or treatment over a prolongedperiod of time, such as hormone replacement or chemotherapy is normally excluded.

Even though insurance companies and brokers want to finance long term cover for policyholders with severe illnesses, they won’t always make it clear to likely clients, at the time of taking out the policy what they are covered for.

While both  Cancer Backup and Macmillan Cancer support have been in consultation with comparableestablishments within the industry to raise the standard of sales practices and make the phrasing of policy documents much clearer, progress has been slow since the report was published two years ago.

Critical illness cover and private medical insurance  is normally taken out by people who are quite hale and hearty. The last thing that crosses their minds is getting cancer. That is why it is so essential to specify a policy’s exclusions before they sign.

A report of best practice for insurance companies writing and selling medical policies has been updated recently by the Association of British Insurers, which is a much needed step in the proper direction.

The market body has now suggested that insurance companies and providers selling these kinds of insurance should orchestrate similar case studies, which clarifies the circumstances when an insurance policy will or will not be paid. Sadly insurers no requirement to adhere to this code, which is voluntary.

Although the ABI’s initiative is to be welcomed, the best way of amplifying an insurance policy is by getting the salesman to explicate the small print.

In addition, industry terminology is in spite of everything even now being used by insurance companies to confuse the consumer. For example it is wrong to grade cancer as an acute or chronic illness, deliberates Cancer Backup. However insurers are resolute that it should go in the chronic category. clients are only informed about this when their claim is rejected.

Although the ABI have got their responsibilities right, the insurance companies can only be forced to better their standards by the regulator. Better training of tele marketing staff, who sell the majority of the policies, is also long overdue.

More precise marketing procedures are needed with jargon being removed. Ultimately it remains the responsibility of the insurersinsurance companies to ensure that their customers are fully aware of the terms of their insurance cover before they commit themselves.

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