Protection  

High protection claims payout rates for Cirencester

High protection claims payout rates for Cirencester

More than £3m in sick pay benefit was paid out by Cirencester Friendly over the course of 2015, its latest claims statistics have shown.

According to the pay-out data from the friendly society, Cirencester Friendly paid 94 per cent of all claims in 2015. During the year, 787 applications were made, of which 97.6 per cent were eligible for consideration.

This left 768 claims to be considered. Of these, 725 were paid out to the tune of £3.2m in sick pay benefit.

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The main reasons why claims were rejected included: proof of earnings could not be supplied; no loss of earnings occurred; and non-disclosure.

Table 1: All claims paid in 2015 by Cirencester

Average Annual Payment

£3,531

Highest Annual Payment

£38,873

Average Length of Claim

327 Days

Average Age of Male Claimant

43

Average Age of Female Claimant

45

The statistics also revealed the highest reason for making a new claim in 2015 was for accident or injury, at 29 per cent.

According to Paul Hudson, chief executive of the friendly society, this highlighted the importance of putting adequate financial safeguards in place to protect against the unexpected.

Mr Hudson said: “Unfortunately the unfounded fear of claims being declined continues to impact the sale of income protection across the entire insurance industry, which is why we feel a transparent approach to the payment of claims is so important, both for consumer confidence and the negative perception that many intermediaries have of protection products.

“Many providers now publish claims statistics and I would urge advisers to use these figures to dispel customer concerns and emphasise the need for good income protection cover.”

Earlier this month, fellow mutual Holloway Friendly paid 96.9 per cent of all income protection claims in 2015, an increase of almost 1 per cent above the 96 per cent it paid out in 2014.

Adviser view

Paul Reed, director of Cardiff-based Vita, said: “There is a common misconception by consumers that insurers try and wriggle out of claims, with a recent survey showing that the public only believe only a fraction of claims will be paid.

“The stong figures from Cirencester Friendly are just another example this is not the case. The publication of these figures, as well as campaigns such as Seven Families, are a critical part of raising awareness of the importance of having adequate Protection in place, as well as breaking down the misconceptions people hold about insurance policies.”

What next?

Catch up with the latest protection-related CPD in our guide on pay-as-you-live-technology: Guide to PAYL technology