Consumer scepticism of protection products needs to be tackled
19 September 2018
Many consumers remain sceptical about the level of insurance claims paid out, new research from Aegon has shown.
An overwhelming 92% of people believed the UK insurance industry pays out less than 90% of protection claims each year, with just 8% believing the figure was higher than that.
Aegon labeled the findings “disturbingly low” in light of the Association of British Insurers’ report that 97.8% of claims made across group and individual protection in the UK were paid in 2017.
Respondents to the survey correctly identified factors which may affect a pay out, including inaccurate information about policyholders on applications and claiming for something that’s not included in the policy. However, the results also revealed a lack of trust in providers, with the third most common reason for a claim being declined listed as believing that insurance companies find loopholes to avoid having to pay.
Simon Jacobs, head of underwriting and claims, Aegon, commented: “Despite the fact that as an industry we’re paying almost all claims we receive, confidence in protection and its providers continues to be low. The fact that only 8% of people believe that we pay more than 90% of claims is concerning and shows that the message we do pay all valid protection claims is failing to reach people.”
Every year protection providers publish claims data to explain the number of claims they’ve paid out to customers.
Jacobs added: “The reality is that contentious claims are few and far between. Just 2.2% of all claims aren’t paid, and in the vast majority of cases, there’s a very clear reason for this. It’s central to our business and as an industry we need to showcase claims statistics and stamp out any lingering doubt that insurers don’t pay legitimate claims.”
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