Critical Illness Cover Standards - Mortgages - News - Moneyfacts

News

Critical Illness Cover Standards

Critical Illness Cover Standards

Category: Mortgages

Updated: 31/10/2008
First Published: 08/08/2006

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

A new initiative to improve Critical Illness cover (CIC) has been launched by the Association of British Insurers (ABI), writes Jane Baker. The 'Statement of Best Practice for Critical Illness Cover' will enable customers to understand exactly what CIC provides and what they can claim for.

Following in-depth consultation and consumer research, key changes include a new standard description of CIC to ensure consumers see a consistent explanation of the product.

The wording is as follows: 'Life and critical illness cover pays out a lump sum if you either die or are diagnosed with a critical illness that meets our policy definition. We only cover the critical illnesses we define in our policy and no others'. Furthermore, better definitions of each critical illness will give a clearer view of exactly what is covered so there is less room for doubt about when policyholders should make a claim, leading to fewer rejections.

Nick Kirwan, Chairman of the ABI's Critical Illness Working Party, said: "Consumers will see the new standard description over and over again from all insurers and this will reinforce the message of what critical illness cover does and doesn't do. Over 12 million adults and children are covered by around five million critical illness policies which have paid out over £1.6 billion since 2000 to people who are critically ill. These changes will ensure that the product continues to meet this essential consumer need at an affordable price."

Commenting on the ABI's initiative, Roger Edwards, Product Director at critical illness insurer Bright Grey, said: "We support the changes to the descriptions of critical illness definitions as they will bring greater clarity and consistency across the industry. This has to be to the benefit of consumers and we believe it is also the best way forward if we are to secure the future of critical illness cover in its present form." He added: "Critical illness cover is an important part of the protection mix and the new 'Statement of Best Practice' will enable it to remain relevant in the face of future medical developments."

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Remortgaging bounces back

Remortgaging has been enjoying a welcome boost in recent months, despite September’s slight dip, with many homeowners capitalising on record low mortgage rates to boost their finances.

Bank of Mum and Dad holds the (house) key

The Bank of Mum and Dad is an important source of finance for many young adults, and it seems that they still hold the key – in more ways than one.

Fee-free mortgages on the rise

Mortgage rates may be at record lows, but for some people, the extra costs associated can make switching deals a financial impossibility. It’ll come as welcome news, then, that the number of fee-free deals has more than doubled over the past year!
 
Close