You are here: Home - Insurance - News -

Measures to build consumer trust in insurance announced

Written by:
Plans for a new industry code on vulnerable customers at renewal, and to publish industry wide data on how many claims are accepted for motor, property and travel products, have been announced by ABI chair Paul Evans.

In his speech at the ABI Biennial Conference, Evans said the new code and claims acceptance rates publication are part of plans to bolster greater trust between insurers and customers and represent “a real watershed moment” for the industry.

The joint ABI and British Insurance Brokers Association (BIBA) voluntary code on vulnerable customers at renewal would apply to motor and household customers. Each firm’s definition of vulnerability may vary and the code would refer to a range of risk factors that can lead to vulnerability including low literacy or numeracy skills, mental health issues, old age or a recent bereavement.

It would help address concerns vulnerable customers might simply renew their policy from one year to the next without checking or understanding what their options are.

It will include commitments on staff training, improved business processes and tailored communication to help insurers and brokers deal appropriately and flexibly with vulnerability at renewal. The organisations aim to joint-publish by the end of 2015.

Later this year, the ABI also plans to publish claims acceptance rates, together with the average claim cost, and the percentage of customers who were paid a claim in the past year. This will mean that for the first time the industry will set out the percentage of motor, property and travel claims that are paid across the industry.

Figures will be published on an industry wide basis to show the value of insurance products for consumers. High acceptance rates would offer greater certainty that policies will deliver when needed.

Products with lower acceptance rates may indicate consumers have more difficulty understanding what they are covered for. The ABI speculates this could bring about a greater focus on providing clear and simple guidance for customers.

“I am delighted to announce today two ABI led initiatives which will help the general insurance sector build trust,” Evans said.

“We are working in partnership with the British Insurance Brokers Association to publish a joint code on vulnerable customers at renewal. This will seek to address the concern vulnerable customers might simply renew their policy from one year to the next without checking they are getting the cover they really need at a fair price.

“We will seek to address the perception insurers don’t pay claims through improved transparency. Having collected data from our members, early next month the ABI will publish for the first time the overall claims acceptance rates for each of motor, property and travel products.

“This represents a real watershed moment. It will hopefully go some way towards reassuring customers our intention is not to avoid paying out when they need us most – but the very opposite is true.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

The savings accounts paying the most interest

It’s time to get your finances in shape, and moving your cash savings to a higher paying deal is a good plac...

Everything you need to know about being furloughed

Few people had heard of ‘furlough’ before March 2020, but the coronavirus pandemic thrust the idea of bein...

The experts’ guide to sorting out your personal finances in 2021

From opting to ‘low spend’ months to imposing your own ‘cooling-off period’, industry experts reveal t...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week