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Obtaining Critical Illness cover for anyone with Type 2 Diabetes can be very difficult, but it is possible in some circumstances, as one of our recent cases demonstrates.
The first problem is that most insurance companies will automatically decline any application for Critical Illness cover from a person with Type 2 diabetes, irrespective of positive factors, such as good control and lack of complications. So it’s difficult for consumers to know where to go.
Normally buying life insurance and critical illness cover can be done in many places like the bank, large comparison websites and financial advisers, however if your personal circumstances mean that you do not fit the standard mould, you would be well advised to use the services of a life insurance broker who has particular specialisation in dealing with people who have health conditions.
Moneysworth has been successful in arranging Life and Critical Illness cover on a number of occasions for people with Type 2 Diabetes, as a recent case demonstrates.
A gentleman in his early 40’s made an enquiry on our website: www.moneysworth.co.uk. Type 2 Diabetes had relatively recently been diagnosed, his control was good and he didn’t have any diabetic complications, but he was overweight. With a raised BMI (Body Mass Index) of 31, this made finding cover even more difficult. He wanted Life and Critical Illness cover and had a specific budget in mind for his premiums of £75 per month.
As we do in all cases, we researched the whole market for the client to see if life and critical illness cover would be available. Our research indicated that only one insurance company would offer him cover, so we applied to them. The insurer wrote to his GP surgery for further medical information and on receipt of that offered a guaranteed premium policy for £75 per month, covering the client for Level Life or Critical Illness cover (without exclusions) of £75,350 over 23 years.
People with an existing health condition who have been declined elsewhere should not give up hope of getting the cover they want until they have used the services of a specialist life insurance broker. If a client wants to find out what might be available and apply, Moneysworth do not charge a fee. This means Moneysworth is only paid a commission by an insurer if we are successful. Remember if you’re unsure if a broker is a specialist, you could ask the question: ‘What percentage of your clients have pre-existing health conditions?’. At Moneysworth that figure is over 75%!
We have just received the following email from a new client.
”Just to let you know, your company has been really responsive and kept me well informed hence the reason I trust you to provide me with the life insurance. Another competitor just called and after many excuses why they were late to come back to me they also said Aegon can insure me but I decline as you guys were faster, and far better in my mind (the other lot tried to come over the phone in a very posh manner which does not mean anything to me, service is the key!). Happy for you to share this with your colleagues and if required please post online as I am a happy customer”
Like all companies we are always pleased when our hard efforts to provide good service are recognised by our customers.
Through good service we’ve earned trust and ‘Trust’ is what our clients are looking for.
Hello and Welcome!
We are proud to launch our new website which with a great deal of consideration, has taken over a year to develop.
The new site is very different to the old one and we thought it might be useful to explain some of the thinking that has gone into the design and content.
Firstly we were aware that our website had not kept pace with the changes in our business and especially our client groups. Put simply any visitor to the old site might well conclude that our life cover services were designed only for people with pre existing health conditions. However the truth is that we arrange life cover for a much wider range of clients, including people with no health conditions, business owners and clients with occupational and/or overseas travel issues.
Secondly we knew that the old website looked dated and the new site needed a much fresher approach. Financial services websites generally are often criticised for being somewhat dull, so it was important to us that visitors find the new site visually stimulating and engaging.
Our clients receive a bespoke personal service and we wanted the new website to visually send a clear message to visitors, that we are different. We have tried hard to make the site easy to read and visually engaging by breaking information down into manageable amounts. We have used space to de-clutter and chosen a font which feels personable (and different again) and is easier on the eye.
Functionality was another key consideration. We have tried to make the new website easy to navigate and as simple to use as possible. We have tried to make it easy for customers to communicate with us, whether making an enquiry or asking us any questions (e.g. email, phone, live chat). It’s really easy for visitors to share a link to any page they think may be of interest with a friend. Underlying all of this is a clear invitation for visitors to engage with us.
Finally we wanted to create a website that visitors find genuinely useful and compelling. In short we want people to leave our site feeling their visit has been worthwhile and the key issue here is the quality of the content.
Here we have tried as much as possible to put ourselves in the shoes of our clients. We asked ourselves time and time again ‘what are the questions that customers really want answers to?’ ‘How are customers feeling as they approach applying for life insurance?’ ‘What concerns do they have?’ ‘What information might help customers feel more confident’? For example, some people with pre-existing health conditions may fear that life insurance premium rates would be completely unaffordable in their particular situation. They may fear the embarrassment explaining that it was unaffordable. For some these potential negative outcomes might cause them to avoid making any enquiry at all. It is for this reason that we have decided to include a selection of real cases, showing actual premium and cover amounts achieved for some of our customers on the diabetes and heart condition pages of the site. Throughout the website we have similarly tried to include lots of additional information which we think visitors might find useful.
When it comes to life insurance, we believe that what customers are looking for above all, is to feel confident in the decisions they are making. We hope you find our website of genuine value and we look forward to being of service.
On 2nd December Jill Insley wrote an article ( http://t.co/1Cx2wAzR ) in The Observer about Nic Hughes whose critical illness claim has been turned down by Friends Life. A campaign has started to get Friends Life to overturn their decision and backed by @stephenfry on twitter the campaign is set to gain momentum.
We have decided to support the campaign and we want to explain our reasons why.
As we have previously expressed, we have had concerns for some time that the way that life insurance companies currently work may be leaving some customers exposed to the danger of a claim being turned down. When it comes to critical illness and life insurance there can be nothing worse than thinking you have done the right thing and protected your family with personal insurance cover only to find out when its too late that the insurance company has thrown out the claim due to ‘non disclosure’.
We accept that there are some occasions where due to deliberate non disclosure an insurance company will be quite within their rights to decline a claim.
However we believe there currently exists a grey area where it is much less clear that a customer has deliberately non disclosed. Misunderstandings concerning disclosure can and do arise and in the case of Nic Hughes it looks as though this might have been part of the problem.
We believe that the current underwriting practices used by most life insurance companies are adding to this problem. This is because most life companies often deliberately make the decision not to write for further medical information from the client’s GP at the application stage, even though the client might have disclosed one or more medical conditions on the application form. For medical disclosures such as heart disease and cancer, life insurance companies will nearly always prefer to write out to the client’s GP for further medical information. But there are many potentially ‘less serious’ conditions where the insurance company may decide not to bother with this stage of the process and to offer acceptance terms straight away. In fact life insurance companies adopt this approach for the majority of applications.
The problem is that where there is no independent medical verification there can be an increased risk of misunderstanding and therefore of a claim being declined, which is potentially catastrophic for the policy holder.
Life insurance companies argue that if they were to write out for medical evidence in a greater number of cases that this would add to their costs and that it would delay customers obtaining cover. They say that customers want cover quickly and that if they can’t get it quickly they will be put off taking out insurance.
We disagree strongly and so do most of our clients. We think that the argument that the ‘client needs a fast turnaround’ is a smoke screen and that there may be other motivating factors.
Here @MoneysworthUK our clients tell us that the most important thing for them is to know that their cover is valid. Getting the job done right is much more important than getting a quick fix. In the main they positively welcome a GP report as part of the underwriting process, because it makes them feel safer that they haven’t accidentally left something out. That’s probably not surprising when you consider that the majority of our clients already have an existing health condition such as diabetes, heart disease, mental health etc.
In the case of Nic Hughes, had the life insurance company written out to the client’s GP for a report before making their underwriting decision then the current situation could have been avoided. If they had declined or postponed cover then Nic could have explored other avenues to see if other options were available. Instead of which the insurance company seems to have taken the easy route which has turned out to be easy for them but very difficult for Nic and for his family.
In Nic’s case we think Friends Life should settle the claim. If you would like to sign the petition here is the link https://t.co/7KlFyuOL
Furthermore we think that Nic’s case illustrates the need for a reassessment of underwriting procedures across all life insurance companies. One possible way of dealing with this issue would be to make insurance companies fully liable for claims arising after a limited initial period – that would change the way life insurance companies approached their underwriting processes as they would not be able to rely on non disclosure at the claim stage. But it would leave customers knowing where they stand.
In the meantime until life insurance companies change their ways we think that ‘grey’ cases should be settled in favour of the applicants.
I said recently that more needs to be done to address the number of critical illness claims that are being rejected.
I was commenting following the publication of Scottish Provident’s latest claims stats. But in the interests of balance I should say that I didn’t mean to imply that Scottish Provident (at 7%) stood out from the crowd.
Scottish Widows do – at 13%!
Thats the figure for 2011 according a recent article by John Fitzsimons called Make A Successful Claim On Your Critical Illness Insurance‘. Apparently that figure represents as 30% increase on the percentage of claims rejected by Scottish Widows the previous year!
This figure should cause everyone concern and definately requires further investigation. Don’t forget that what we are talking about here is a bankassurance critical illness plan. This means that for millions of customers of the banking group a Scottish Widows critical illness plan will effectively have been the only choice offered to them.
If you have a Scottish Widows critical illness plan maybe its time to start asking some questions.
Yes, you do have choices about how you apply for life insurance and if you have diabetes making the wrong ones could cost you.
So here are the tips
1) Fully Disclose All Medical Information – cutting corners or forgetting to mention medical information risks making your cover invalid, but if you fully disclose all information you will have peace of mind knowing that the cover is valid.
2) Applying Direct To A Life Insurance Company Has Downsides – There is nothing wrong in applying direct its just that in doing so there’s a very good chance that you will end up paying more than you need to because there’s will be a good chance that another life insurance company would have charged a cheaper premium. In fact if you already applied direct to a life company and have an existing policy you should still read the tips below and consider getting a second opinion. It wont cost you anything but could save you lots.
3) Research Is Important – Good research will pay dividends and can save you a small fortune. Unfortunately its not easy to do this yourself.
4) Use An Expert – Some companies specialise in offering a service for people with pre existing health conditions such as diabetes, providing a more expert service to help find you best deal www.moneysworth.co.uk are one such company who individually research every single case and provide this service on a non fee basis so they are able to provide you with an indication of likely premium before you apply. An expert will also be able to provide you with information about what other associated types of insurance cover might be available, such as critical illness or income protection.
5) Most Advisers Do Not Specialise In Diabetes – If they dont really specialise its unlikely that they will be able to perform the research to the same standard as a real specialist.
6) How to Spot A Non Specialist – There are a number of ways. 1) Check the website -if the company is genuinely offering a specialist service this should be clear visible on the webite. 2) When speaking on the phone are they asking you the right kinds of questions about your diabetes, do they sound like they are dealing in this day in day out? 3) Sometimes companies pretend to be expert, they tend to rush to the application stage before doing any research – If they quote a preium straight away its probably not a good sign. If in doubt a good questions to ask is what percentage of their clients have diabetes.
7) Think About The Future As Well As The Present – If you develop further complications or additional health conditions in the future you may find it more difficult to obtain cover in the future. As a diabetic if you develop cardio vascular disease in the future, as things currently stand in the market, you will not be able to obtain new life insurance from any mainstream insurer.
8) Guaranteed Premium Rates Are Best – This means that the premiums cannot be increased in the future so you know where you stand so make sure that your premiums are not reviewable.
9) Remember That Once Your Policy Starts Your Insurance Is Guaranteed – Once your policy begins future health changes will not effect your cover or your premiums, which means you no longer have to worry about what the future may bring.
10) Prices for New Policies Will Go Up At The End Of The Year – This is true, especially so for females. If you have diabetes the process time from start to finish for life insurnace normally takes weeks rather than days. You can avoid the price hike by getting your cover in place before the changes take place – that probably means getting on with things now
If you would like a quote or would like to speak to an expert visit www.moneysworth.co.uk or call us on 0845 430 5200
