As a population slowly but surely more and more services are being offered online. We all want things yesterday and thus many have turned to using online facilities to quote for a life insurance policy and have taken out a plan off the back of these quotes without any consultation.
In the coming year the Office of Fair Trading (OFT) is to invest the time into a study covering consumer contracts, with the aim of identifying the issues that cause the most confusion for the consumer. For the financial sector this will see the OFT examine both critical illness policy and term assurance contracts, where contractual issues have been the subject of controversy in recent years. The area of online purchasing of contract-based products will be a particular focus within the study, according to the OFT.
The OFT intend to examine ‘fine print’ issues, in order to identify which of the contractual arrangements have most often lead to consumers losing out due to not understanding the detail of their agreement.
We saw the Association of British Insurers already highlight the issue of insurance companies providing instant online quotes putting the honus on the consumer which often led to the provider failing to ensure that individual understood the requirements of the contract being offered. The problem highlighted the need for the services of independent financial advisers, using an adviser puts the honus on them to fully explain the contract to the consumer ensuring they are making an informed decision.
Take a critical illness policy for instance, the individual buying the plan is often unaware of the extent of the illnesses covering some not understandign that the likes of back pain and stress are usually not covered. In some cases other illness that are indeed covered by the plan will sometimes not result in a payout, in the case of a stroke most policy only payout if it has left permanent symptoms. Whilst one of the most common critical illnesses, a heart attack is often measured on a level of severity and you could well find that suffering a critical illness of a mild severity may not see a payout from your critical illness insurance provider.
As with many insurance policies a critical illness plan does not pay for injuries or conditions deemed to result from a form of self infliction such as alcohol or drug abuse or as a result of any criminal acts.
If you want some life insurance advice or are looking for a critical illness quote we will take you through the whole process ensuring you are fully informed when making your decision.
For more from the Office of Fair Trading visit their site or visit British Insurance Brokers’ Association for more information on using an insurance broker.
