Aegon pays more on income protection

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The Independent Online

Insurance giant Aegon Scottish Equitable has said it is paying out a greater proportion of income protection claims than in the past.

The insurance, which pays an income to policyholders should they be unable to work due to ill health, unemployment or an accident, has long been dogged by claims that insurers are prone to refuse claims unfairly.

Refusals usually occur because the policyholder has failed to disclose information the insurer deems relevant. However, last year the industry agreed to take a more flexible approach to non-disclosure, refusing claims outright and in their entirety only when the policyholder is deemed to have lied about an important circumstance which, if disclosed, would have had a major impact on the premium quoted or led to cover not being offered.

Since the industry's non-disclosure agreement, a host of providers has announced a sharp rise in the percentage of claims paid. Aegon Scottish Equitable is the latest to do so, saying that in 2008 it paid 93 per cent of claims compared with 85 per cent in 2007. Helen Morris, from the insurers, said it wanted to nip the problem of non-disclosure in the bud by giving more information to policyholders and their advisers. "We want to encourage full disclosure at the application stage and to this end we have launched an 'understanding claims' website," she said. "It features all the tools and information an adviser needs to help clients understand the claims process and how to avoid non-disclosure occurring."

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