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, will be announced by ABI Chairman and AXA UK CEO Paul Evans later today.
In his speech at the ABI biennial conference Evans is expected to say that the new code and claims acceptance rates publication were part of plans to bolster greater trust between insurers and customers and ‘represented a real watershed moment’ for the industry.
The joint ABI and British Insurance Brokers Association 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.
The ABI says it would help address concerns that 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 aim is that it will be published by the end of the year.
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 that consumers have more difficulty understanding what they are covered for. This could bring about a greater focus on providing clear and simple guidance for customers.
Paul Evans will say: “Firstly, we are working in partnership with the British Insurance Brokers Association to publish a joint ABI and BIBA code on vulnerable customers at renewal.
“This will seek to address the concern that 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.
“Secondly we will seek to address the perception that insurers don’t pay claims through improved transparency.
“Having collected the 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 that our intention is not to avoid paying out when they need us most – but that the very opposite is true.”