Norwich Union reports that critical illness payments in 2005 rose significantly compared to 2004.
Norwich Union payouts on critical illness (CI) policies increased to over Ł80m in 2005; almost a quarter higher (23%) than in 2004. In total 1,123 claims were paid and the average payout was about Ł73,000.
The top five causes for claims in 2005 were:
- Cancer 68.1%
- Heart attack 8.3%
- Multiple sclerosis 6.9%
- Stroke 5.6%
- Heart surgery 2.5%
Almost nine times more men claimed for a heart attack than women, but twice as many women claimed for multiple sclerosis. In 2005, a typical critical illness policy had been in force for less than four years (average of three years and seven months) at the time of claim.
Norwich Union declined 12% claims due to non-disclosure of medical facts at policy outset and a further 11% of cases were denied as policy conditions were not met.
Louise Colley, head of protection products at Norwich Union, said: "People use critical illness policies to protect against the potentially financially devastating problem of contracting a critical illness.
"For most people critical illness policies are providing invaluable cover for people when they most need it, paying out Ł80m in 2005 alone.
"Last year, the value of critical illness claims met by Norwich Union increased by 23%, highlighting the valuable role that critical illness cover is increasingly playing.
"Norwich Union is striving to find new ways to reduce the levels of non-disclosure in policy document. Earlier this year we introduced a ‘full disclosure’ factsheet in all our information packs further underlining the importance of completing forms carefully, accurately and completely."
Philippa Gee, director at Torquil Clark, said: "Critical illness cover can be an important contract for those concerned about protecting their finances in case of serious ill health. It is essential that clients appreciate that not all policies are similar, in fact they vary considerably both in terms of the cover provided and the reliability of the insurer. It is therefore crucial that the decision to proceed is not based purely on price, but with the help of an independent adviser and the most appropriate policy is selected.
"The issue of non-disclosure is a major one, however, with the right insurer and a full account of your medical history, you are taking the best steps possible to secure this important type of cover.
"With the level of debt that now exists in this country, coupled with the lack of savings to provide a financial cushion, critical illness cover can be one of a variety of useful policies. Some products in the market place are better than others, however an independent financial adviser is best placed to help you with the essential selection process."
Download Norwich Union Critical Illness Report PDF (2.2MB)
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Notes to editors:
Norwich Union is the UK’s largest insurer. It is a leading provider of life, pensions and investment products and one of the largest financial adviser (FA) providers. FAs provide over 70% of the company's long-term savings business in the UK.
Norwich Union is the UK’s largest general insurer with a market share of around 14%, with a focus on insurance for individuals and small businesses.
Norwich Union’s news releases and a selection of images are available from Aviva's internet press centre at www.aviva.com/media