Long gone are the days when nobody quite knew how individual insurance companies dealt with claims. How many did they reject? What were the reasons for not meeting claims?
Such a lack of openness fuelled a deep suspicion among more sceptical consumer journalists that protection cover merely protected the profits of the providers. That if an insurer could get out of meeting a claim it would do, even if it meant trawling through a claimant’s past medical records for excuses to reject.
Today, insurance glasnost has taken grip. Most of the big players (not all) are now quite happy publishing their claims statistics. The more recent company to send me details about how it was treating claims was Zurich, which less than a month ago furnished me with data for the first half of this year.
Indeed, it sent the proverbial works, not only providing me with ‘percentage of claims met’ figures for life insurance (95 per cent), critical illness (89 per cent) and income protection (87 per cent), but for general insurance as well.
Good on ya, Zurich, although it is disappointing that the protection figures have yet to find their way onto the relevant page on its website: www.zurich.co.uk/en/personal/insurance/life-insurance. The only statistics that make it onto this consumer page relate to 2015 life insurance claims (98.5 per cent met). Tardy.
So, we are now in a more open, transparent environment where protection insurance policies industry-wide paid out £9.9m in claims in 2015.This is good for buyers of protection insurance who can see that they are purchasing worthwhile cover. Good for financial advisers who have the tricky job of selling policies to sceptical clients. And good for probing journalists who can get a sense of how individual companies are treating claimants.
Yet, if my sources are correct (they are impeccable), I fear there is big pressure building within the insurance industry for the current era of glasnost to be brought to an abrupt end. That it should return to the bad old ways and days when secrecy ruled the insurers’ waves. Goodbye Gorbachev. Hello Putin.
My main source (a massive advocate for the protection insurance industry) was recently at an insurance conference where numerous reinsurers were openly criticising the publication of claims statistics.
Face up to the fact that if the insurance industry returns to its old horrible ways, protection cover will be even more of a niche product than it is today.Jeff PrestridgeTheir argument was that the publication of such data is "boring, repetitive, daft even". They also said that claims statistics are not influential in helping persuade the public to take out cover, so their publication is a waste of time.
And, of course, they argued that the issuing of claims figures does not stop horrible journalists like me from criticising insurers whenever they have the temerity to decline a claim (yawn, yawn).
On that point, they are 100 per cent right – it does not. If a reader comes to me with details about a claim that has been rejected – and upon investigation the decision appears unfair – it is my duty to investigate. It is what I do for a living. It always will be while I remain employed as a personal finance journalist.
My mole was incandescent with rage when he told me what he had heard at this conference. Indeed, at one stage, I thought his blood pressure might boil over, triggering a claim on his own array of insurance policies.
I will quote what he said almost verbatim – I have trimmed out a little of his anger: "I find it astounding that we are still debating whether or not it is important to tell our customers how many claims are paid. Paying claims is why people buy the cover. It is the reason we all go to work.
"Yes, it can get a bit repetitive, but publishing the numbers has helped raise the credibility of protection insurance with consumers, advisers and media more than anything else in the past 20 years."
His parting comment was: "There is no room for small print, catches and hidden truths. Just do good things and shout about them."
Spot on Mr Mole.
In publishing claims statistics, insurers are able to disprove the view that they reject more claims than they accept. Indeed, Zurich told me that when questioned, most customers believe insurers pay fewer than 50 per cent of claims.
Continued publication of claims figures, it said, should help build customer confidence in this most important of household purchases.
So, reinsurers, my message to you is simple. Stop whining. Stop seeing the past through rose-tinted spectacles. Face up to the fact that if the insurance industry returns to its old horrible ways, protection cover will be even more of a niche product than it is today.
So, insurers, big and small. Publish and be damned. Nothing less will do. May glasnost continue to flourish.
Jeff Prestridge is personal finance editor of the Mail on Sunday
