LV= backs protection insurance reforms

by Gill Montia

Story link: LV= backs protection insurance reforms

LV= has responded enthusiastically to an industry-wide initiative regarding payment of protection insurance claims.

The friendly society has signed up to a new code of conduct, under which insurers promise to pay valid claims, except in cases of fraudulence or recklessness.

The insurer is also working to improve the disclosure process, stating: “Our innovative and bespoke UK-based tele-interviewing service is just one part of our approach to ensure the accurate capturing of clients’ details, as well as ensuring clear and comprehensive up-front disclosure.”

LV= worked with the Association of British Insurers in drawing up the agreement, which is aimed at supporting providers and financial advisers, as well as building trust with consumers.

Under the new rules, customers claiming on their critical illness insurance, income protection and life insurance policies will receive benefits where medical information has not been disclosed, providing the customer has not deliberately withheld it.

In the event of a policyholder failing to provide relevant medical information, insurers will pay out a sum that is reflective of the risk, and the premiums already paid.

Full premium refunds will be given if the insurer decides that the policy would not have been sold, had the insurer known the full facts.

The agreement follows a number of other industry-wide measures, such as changes to application forms and improved communications between insurance firms and claimants.

These changes have already contributed to a fall in the number of refuted claims.