

ABI: New guidance for phone and online protection insurance
The Association of British Insurers (ABI) has issued new guidance for protection insurance provided online or by the phone.
The body is aiming to improve clarity for consumers taking protection insurance and increase the number of successful claims, in an area that is expected to produce a significant percentage of business over the coming years.
Nick Starling, ABI director of general insurance and health, said: "In recent years we have seen a growing trend of people taking out life, critical illness and income protection insurance over the phone and online, especially via intermediaries.
"This latest ABI initiative will help ensure that the UK uses world-class online and telephone processes to help people disclose all the relevant information about their medical history. This will help ensure that people who take out cover in this way can rely on their policy to pay out when the need arises."
He added: "We want to ensure that people have full confidence in, and understanding of, the products available. Our latest guidance marks another positive step towards this goal."
Under the guidelines, when a policy is being bought, details of the application should be clearly explained to applicants - at the beginning of the process while online and at the beginning or during applications over the phone. Phone conversations should also be recorded, backed-up, and stored.
Supporting documentation should be recommended to customers and they should be asked if they understand them. Furthermore, explanations of the questioning process and the importance of checking and correcting answers, along with a number of other elements of the application process should be clearly explained.
The ABI guide also recommends that applicants be given clear and unambiguous warnings about the consequences of non-disclosure and of their continuing duty to disclose any information that could affect their insurance cover.
The body suggests that consumers are told: "You must answer our questions to the best of your knowledge and belief. If your answers change between the time you apply for insurance and the time your policy starts you must tell us. If you do not tell us, we might not pay."
Warnings about non-disclosure should also be repeated in the confirmation schedules or interview reports sent to customers.