ProtectionMay 16 2013

IP providers must embrace transparency

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ByDaniel Liberto

Income protection (IP) providers are being advised to follow the example of critical illness insurance to bolster consumer confidence.

In the latest protection spotlight from Money Management, we report on how publishing claims statistics can help IP improve its public perception.

Though the majority of providers have published their claims data for 2012, others initially refused because IP policies can vary enormously and subsequently are not always comparable. Eventually all of the major providers revealed their figures, although many remain opposed to the ABI template designed to illustrate them.

Size has also been cited as an issue that affects the consistency of data, as smaller providers feel disadvantaged by a greater swing in percentage results.

The Association of British Insurers (ABI) has accepted that a lack of consistency is still an issue, but has nonetheless asked providers to provide their claims statistics in a particular format.

This is seen as essential to differentiate IP from the negative stigma of payment protection insurance (PPI) and to promote transparency in the industry.