Friends Life warning to insurers ahead of claim statistics report
5th January, 2015
Head of Friends Life underwriting, Chris Pollard, has alerted protection providers to the unintended consequences of publishing their annual claim statistics. The industry's yearly claims reporting cycle is imminent and Mr Pollard has urged companies to be aware of the public misconceptions surrounding life cover, which include a belief that the number of claims paid is considerably lower than the reality.
The vast majority of life assurance claims made by customers result in full payment, yet there is still a danger of potential investors making uninformed choices about their family's protection based solely on yearly payout statistics.
Mr Pollard said this of the health cover decision making process: ''If one company pays out 99 per cent of life assurance claims and another pays 95 per cent, what is to be gained from ordering them based on the percentage? Does it mean that one company will deliver a better outcome for the insured’s loved ones? Not necessarily.''
The insurance giant expert acknowledged that the annual statistics report is a valuable resource for the public and accepted that it is here to stay, however he expressed concern over how the results were presented, stating that they shouldn’t read as if ''one result is automatically better or worse than the other.'' People should be encouraged to compare life insurance quotes and find the best deal suited to their particular needs rather than relying purely on simplistic numerical comparison.