Further work needs to be done to increase the speed of the processing of life insurance claims, according to a number of consumer reviews collated by an online insurance comparison and information website.
Drawing on more than 750 reviews of ten major insurers provided by consumers, Insurance Watch claimed that consumers wanted faster payment of claims as well as more communication about the claims process.
Insurance Watch Managing Director, Wally Ripper said the reviews, on which the analysis was based, were provided by current Term, TPD, Trauma and Income Protection insurance policyholders, with the leading cause of complaints within the reviews related to the treatment of claims.
According to Insurance Watch, the most critical reviews came from policy holders whose claim had been declined but even those with successful claims were critical of long payment delays and the volume of documentation required by insurers.
“The Royal Commission emphasized the need for life insurance companies to meet community standards and expectations,” Ripper said, adding “Insurers would therefore do well to listen to this feedback about their claims processes”.
The reviews also found that consumers disliked large premium increases, lengthy wait times when contacting an insurer by phone, and being passed between multiple insurance company representatives, with Ripper adding, “The reviews reveal that if a consumer receives poor customer service from an insurer, they are likely to assume they will also have a poor claims experience”.
“The message for insurers is that they shouldn’t take policyholders for granted. Today’s consumers expect more than just a renewal notice each year. And at claim time they want fair and fast payment,” he added.
Areas in which some insurers received positive reviews included:
Clear and regular communication
- Being able to access policy details online
- Well priced cover
- Comprehensive features
- Easy to understand documentation
- Benefits offered through health and wellness program
Based on the reviews, Insurance Watch said the top three life insurance companies for 2018 were:
- ClearView
- AIA
- OnePath
Unfortunately what most clients don’t realise is that there is a process to all this. I think we could all agree that once the client calls and wants to make a claim they expect the cheque in their hand or the money in their bank account the next day.
It is almost expected that they will fail so sign something send back incomplete paperwork or in some cases non at all. This is where we come in and are expected to help them from A-Z which is fine if they make the effort and get what’s needed in a reasonable period of time. But mostly we spend hours chasing them up for outstanding stuff time and time again. They refuse to do it until it suits them and the abuse us when payment is not forth coming. It is part of what we do as advisers and the time they expect our assistance the most but it is definitely exhausting and time consuming.
God help the insurers if everyone pointed them to the Insurance Company and told them to go there they would need to recruit 20 more people at least just to the claims section to handle the mess.
I am sure the insurance companies do not know or do not care about the time we spend sorting these things out. Isn’t this part of why we get commissions to be there to assist the client and too a large extent { I don’t think that they realise} the Insurers themselves. But what’s happening we are getting less and less to cover our costs and BT announced today a rates increase on existing policies written before August 2018 and new business after April 2019 of 10%. A 10% reduction in commission in conjunction with a 10% price rise.
What next you might ask.
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