Critical IllnessApr 25 2018

How to boost uptake of critical illness cover

  • Learn about the likelihood of getting ill and the financial impact on households.
  • Grasp what are the main barriers preventing people from taking out critical illness cover.
  • Understand what the protection industry can do to help advisers talk to clients about critical illness.
  • Learn about the likelihood of getting ill and the financial impact on households.
  • Grasp what are the main barriers preventing people from taking out critical illness cover.
  • Understand what the protection industry can do to help advisers talk to clients about critical illness.
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How to boost uptake of critical illness cover

Others are too optimistic about the amount of government help they’d receive. In fact, welfare benefits range from only around £70 a week to just over £100 a week.

There is also significant confusion and ignorance concerning the insurance available.

Three big barriers, in particular, stand in the way of greater uptake of critical illness cover: cost, confidence and complexity.

None are entirely well founded, but they need to be addressed if we’re to persuade more people to consider cover.

Insurers and advisers need to be better at getting this message out and showcasing how insurance can and does help people hit by extremely difficult circumstances.

On cost, the providers do what they can to make cover affordable and there’s significant competition in the market. None of it matters, though, if people can’t see the value.

To enable them to do so, we must tackle the other barriers – the complexity of the products and the confidence it will deliver when called on.

The latter should be more easily addressed. Insurers certainly have an image problem.

Survey after survey shows that a majority of the public don’t trust them to pay out. Recent research found that one of the biggest barriers in taking out critical illness was a lack of trust in the providers paying out.

This is totally at odds with the facts, however.

In 2016, Legal & General paid almost 93 per cent of its critical illness claims – claims that totalled £181m – and that rate is above the industry average, according to the ABI.

Most insurers have similarly strong records, and few, if any, have a payout rate that reflects the poor public perception.

Insurers and advisers need to be better at getting this message out and showcasing how insurance can and does help people hit by extremely difficult circumstances.

People need to know that if they make a valid claim it’s very likely to be paid. They also need to consider that the one way they can guarantee they won’t get anything is if they don’t take cover to begin with.

Keeping it simple

It is important to understand what is covered and not covered under any insurance policy, so the customers are more likely to see the value in taking out cover. Keeping it as simple and as relevant as possible is key to this end.

With critical illness policies, some complexity is unavoidable due to the areas that the policy is trying to cover and medical conditions, by their very nature, are not simple.

You then have to consider the severity of the condition.

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