A policy can help if you develop certain life-threatening conditions
Around 20 per cent of claims for critical illness insurance are rejected.
The industry accepts this figure is too high and has taken a number of steps to reduce the failure rate.
These include making application forms more straightforward and standardising the list of qualifying illnesses.
We asked for your comments, a selection of which are below. This debate is now closed.
In 2004 I had a claim for critical illness rejected after I had a brain haemorrhage due to an aneurysm. I was in no frame of mind to contest this until now. I recovered well, but was told by the consultant it was life threatening and also a critical illness and if I had been a smoker or overweight the outcome may have been very different. The ombudsman is dealing with it at the moment.
Patricia Poole, London
I was for many years a Claims Manager for a major critical illness insurer and I can honestly say that we never had any quota. Every claim was considered individually on whether it met the definition and whether there had been any material non-disclosure. I was under no pressure to either accept or turn down any claim and my performance (and pay) was not based on the number of claims I either accepted or rejected. Indeed, it was more in my interest to accept claims as the majority of rejected claims gave rise to complaints which involved much more work. This is my personal view and I would prefer that name is not published as I have been retired for a couple of years.
I was diagnosed with breast cancer in December 2003 and had taken out critical illness in 1997. In the year 2000 we wanted to increase it and it was cheaper to cancel the first one and take out another, which we did. However during the time between one finishing and the other starting I had an appointment with a consultant which I didn't disclose as I didn't consider myself ill or to have a 'change in health'. It was an opportunity to have an investigation that actually led to nothing and the 'material fact' was that there was nothing wrong with me. The insurance company failed to pay out saying that they wouldn't have insured me, which was crazy considering nothing was found to be wrong. In any case we felt that they should have paid up on the first policy but they wouldn't do that because it had been cancelled. They repaid the premiums on the second one but not the first so we actually ended up minus money. What I don't understand is that there was nothing proven to be wrong with me at the time and yet they said they wouldn't have insured me. How can that be fair? The Ombudsman went in their favour and I had to get straight back to work weeks after finishing my treatment.
Listening to this programme, a clear observation struck me. This is something that, I feel, the programme came fairly close to saying, but did not identify outright. The issue is the simple yet gross mismatch between the two different methods used to appraise the applicant/claimant's health record at a) the time of application for a policy and b) by the insurer in response to a claim being made. Method a) seems to be done by way of the applicant's own memory. However, b) involves the insurer demanding and referring to the claimant's detailed medical records. So, the obvious solution is to make it compulsory to utilise - at the application stage - the same medical records.
Nick Clegg, Oxford
My Husband was diagnosed with bowel cancer 17 months ago. Despite having had critical illness/mortgage protection for the past 11 years - we are one of the one in five who have been turned down.
Surely if the companies want our money for a product they can do their own research into our medical histories and stand by their findings as part of the contract.
I took our critical illness cover while buying my first home - a time of many forms. I have recently checked what was on the form sent to our insurer and found that important details I disclosed to the financial advisor were not put on the form sent to the insurer. At the time it was not the norm for the insurance company to send a copy of the form received to the policy holder. I understand this has now changed. I wonder how many people will find themselves, as I could have, thinking they had disclosed information but subsequently finding out that it was never passed on to the underwriters. I would suggest anyone who used a financial advisor to purchase a scheme checks the information submitted on their behalf.
Vicky Munn, Bristol
Congratulations to Dean Turrell for his articulate presentation of the problems of critical illness insurance.
Chris Grey, Guildford
It is not only Critical Illness cover that insurers are ducking out of.
Some years ago we lost our home and our business, despite having paid £20 a week in premiums for four years. I believe so many insurers are avoiding claims that all insurers now have to do the same to remain competitive.
David Norris, Aberdeen
My husband of 35 years died suddenly one morning on the 6th October, 2004. He was 57. He had been sold insurance in May of that year, when he had taken out a loan through our bank. The bank would only let him have the loan if this insurance was in place. After he died, there had to be a post mortem. The findings were that he had a heart attack and they also found "previous ischemic heart disease". The company refused to pay off the Loan citing the previous heart condition. He was not being treated for heart disease and this was only found Post Mortem (after death). I put my case to the Ombudsman but was again turned down as the wording in the policy states, "Any pre-existing condition whether diagnosed or undiagnosed"
My faith in insurance and banks is gone forever.
Julie Woodcock, Spalding, Lincolnshire
Back in 2000, I had a BIG problem with income replacement insurance. I was medically retired from teaching because of depression. I had filled in a form for insurance in the 1990's with a financial advisor and did not even think about disclosing the fact that I had been going to a therapy group. It was my personal choice and I was not advised by a Medical Professional to have therapy. My claim was refused because of non-disclosure of this fact. I could not face fighting the decision and had no idea of where to get help at the time so I just accepted what they said and got all my payments refunded. Now I really would recommend that nobody bother taking up these policies. Why, when I was at my most vulnerable, did I get treated like this and why was no help available?
Alice Kilroy, London
I had critical illness insurance sold to me with my mortgage. I then had a brain tumour. The policy wouldn't pay out due to a pre-existing condition (even though I was completely unaware of this). In the end I gave up trying.
Paul Cunningham, Huddersfield
I know how this chap feels. I've been there. When I took legal action, my solicitor turned out to be even worse, sat on the case, took the legal aid money and did nothing. As I was very ill at the time, after another attempt on my own, I gave up. My brokers were also useless. They made all the right noises but when it came to action they were no help either.
Dolores Fitchie, London
My breast cancer critical illness claim was declined due to non disclosure. Nothing in my medical history shows any connection to my illness. It has been a distressing time on top of the cancer diagnosis. If medical information is so important, it should be obtained when the policy is taken out, not leaving it until a claim is made and at such a vulnerable/devastating time. I really want this to be addressed to stop the misery that this causes.
Irene Cholerton, Sheffield
In 2005 I fell ill just two weeks prior to getting married in Florida and was rushed to hospital. I was told I may have had a small stroke and was not allowed to travel and could not get married. When I got out of hospital I claimed under my joint critical illness policy. On the form I told the insurance company the hospital was 90% sure I had a stroke and further tests were to take place. I gave them access to my medical notes and 8 weeks later I was told I was not able to claim as I had failed to tell them that I suffered from depression in 2000 when my father fell ill with cancer and was told he only had a short time to live (this did not even cross my mind). They also said I did not tell them that my doctor spoke to me about my blood pressure being up a little but I was not on any medication. They should have checked my medical notes before the policy started but I was told they do not have the staff to check everyone's medical notes. They cancelled the policy and returned the payments and reported us both to the police for fraud. We have now both been charged with attempted fraud. I have lost my bank job and can not work because of this. I pointed out to the police when I got arrested that we gave the insurance company permission to see all our medical notes before the policy was to start. I also pointed out the policy states that "to the best of my ability all the information given is correct at the time of signing", and as far as I am concerned it was. I am now left waiting for a court date which could still be a year off, unemployed with no where to turn and just wanting to end it all.
Peter, Isle of Man
As a specialist advisor, I have people referred to me who are about to make claims or who have had claims refused. In some cases a couple of letters is all it takes to overturn a decision. I am fighting a case for a man who, because his insurer took two years to admit his claim, had to take the lump sum from his pension to survive, which resulted in penalties and charges of over £50K plus a severely reduced pension at 65. I see many cases of 'innocent or non-related non-disclosure' where the latest changes will be of tremendous help. I would like to see companies forced to re-examine all failed cases.
Penny O'Nions, Iver, Bucks
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