Just how much does life and critical illness insurance help Britons?

Monday, February 22, 2010

Everyone knows that after you pass away, life insurance will serve to take care of your loved ones. However, have you ever thought of just how many people in Britain this is actually helping? Well, according to statistics published by the Association of British Insurers there was an average of one hundred families a day that received the benefits of their loved one’s life and critical insurance policies. Furthermore, it was stated that the average sum paid was just about double the UK annual salary and resulted in an average of £52,000. It would seem that something is going right when looking at the ethical stance of insurers and the frequency with which they are paying out on claims.

In further statistics, it even shows that the percentage of claims has improved by as much as 10 percent in recent years. Working on figures from 2008, apparently an estimated 90 percent of claims were paid out. This is quite impressive when one compares it to 80 percent claims acceptance just four years earlier. In an attempt to drive this rate of rejected claims even lower, the Association of British Insurers is seeking to join with customers to confront the number of claims that do not meet the definition of Total Permanent Disability. To make these statistics even more impressive, 97 percent of term life insurance claims were paid in 2008. In a statement by the Association of British Insurers, Director of General Insurance and Health, Nick Starling, said:

“The insurance industry pays out £5.9m every day in life and critical illness insurance claims, making a real difference to people’s lives at the most difficult of times. Insurance companies want to pay all valid claims, which is why the ABI is not complacent and continues to look at ways to reduce the number of claims declined even further. The new ABI code is making a dramatic improvement to the number of critical illness claims we pay. We have been working with the Law Commission so that the principles of our Code are embedded into law.”


Neil DeCampo