nottheaverageactuary

Actuarial news and views from Cape Town and beyond

Accounts and disclosure – Insurance companies

Leave a comment

We have heard many times how important it is for policyholders to disclose all relevant information to their insurer in order to avoid any problems when claims are made. There have been many instances where insurers have refused to pay out a claim because of the policyholder’s non-disclosure of vital information. An example is the story of Carol Neil vs Aviva insurance company in England.

Carol Neil, a mother of two who was given a year to live owing to ovarian cancer, was refused her life insurance payout because she failed to disclose that she saw a doctor about headaches and heart problems 5 years before she got the policy. Aviva argued that had they known about these issues they would not have offered her life insurance. When they found out about this information, they canceled her cover and paid back all the money she had paid. Carol appealed this decision but failed. http://www.dailymail.co.uk/news/article-2353646/Aviva-Insurance–Dying-mother-Carol-Neil-refused-pay-failed-disclose-information-HEADACHE.html.

It is also very important that insurance companies make financial statements available for the public to read. The following is a statement regarding accounts and disclosure made by Santam Short-term insurance company.

“Peace of mind for our clients doesn’t just end at a good broker relationship and a smooth claims process. As South Africa’s leading short-term insurer, transparency is key in how we conduct our business, and it has been that way for the last 96 years. As a client, you’ll want to know that the company you’re insuring with takes their business as seriously as you take your insurance needs.” this statement was followed by links to Santam’s financial reports –http://www.santam.co.za/financial-information/financial-results/

When insurers fail to provide financial records or account for the decisions they have made they violate corporate governance principles of fairness, accountability, responsibility and transparency. Case in point, United Policyholders vs FEMA (an independent agency that manages the National flood insurance program in America).

United Policyholders (UP), an organisation whose mission is to be an effective voice for insurance consumers in America, filed a suit against FEMA for failing to disclose claims documents relating to Hurricane Sandy victims. UP called out FEMA for proclaiming that they were transparent regarding its claims processes when in fact they failed to respond to requests to make the claims documents available for the public to view.

http://www.propertyinsurancecoveragelaw.com/2015/02/articles/hurricane-sandy-1/united-policyholders-sues-fema-over-withheld-sandy-claims-documents/

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s