Advice firm Drewberry has launched a campaign to raise consumer awareness of how high payout rates are for insurance products such as life insurance, income protection and critical illness cover.
The firm’s protection survey last year found consumers believed only 50 per cent of life insurance claims were paid out by insurers, compared to the actual percentage of claims being paid, with the Association of British Insurers reporting that 98.2 per cent of all term life insurance claims were paid out in 2015.
Drewberry have built a one question survey, with those entering going into a draw to win a prize of £500. This asks participants what percentage of protection claims they believe were paid in 2015.
Once entrants submit their answer, a drop down appears to thank them for entering and reveals the actual payout rate as published by the ABI, along with a breakdown for life insurance, critical illness and income protection, with an option to find out more about those products.
Drewberry will be working with a number of websites and blogs to promote the campaign, along with posting the survey out via social media.
Director Tom Conner said the percentages of claims paid by protection insurers are “generally excellent” and have improved enormously over the last 10 years.
“Despite this, the general public have the impression that payout rates are truly appalling,” he stated.
“Insurers have become very good at releasing and publicising their payout rates among the adviser community, but have made no attempt to advertise these impressive rates directly to consumers, so there has been very little change in consumer perception since these rates started being published a number of years ago.”
Mr Conner added: “We hope this campaign can go a little way to bridging the gap between perception and reality, and we encourage other advisers and insurers to do their bit because hopefully as a collective we can start to change the negative way in which our industry is perceived.”
peter.walker@ft.com
