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On 2nd December Jill Insley wrote an article (  )  in The Observer about Nic Hughes whose critical illness claim has been turned down by Friends Life. A campaign has started to get Friends Life to overturn their decision and backed by @stephenfry on twitter the campaign is set to gain momentum.

We have decided to support the campaign and we want to explain our reasons why.

As we have previously expressed, we have had concerns for some time that the way that life insurance companies currently work may be leaving some customers exposed to the danger of a claim being turned down. When it comes to critical illness and life insurance there can be nothing worse than thinking you have done the right thing and protected your family with personal insurance cover only to find out when its too late that the insurance company has thrown out the claim due to ‘non disclosure’.

We accept that there are some occasions where due to deliberate non disclosure an insurance company will be quite within their rights to decline a claim.

However we believe there currently exists a grey area where it is much less clear that a customer has deliberately non disclosed. Misunderstandings concerning disclosure can and do arise and in the case of Nic Hughes it looks as though this might have been part of the problem.

We believe that the current underwriting practices used by most life insurance companies are adding to this problem. This is because most life companies often deliberately make the decision not to write for further medical information from the client’s GP at the application stage, even though the client might have disclosed one or more medical conditions on the application form. For medical disclosures such as heart disease and cancer, life insurance companies will nearly always prefer to write out to the client’s GP for further medical information. But there are many potentially ‘less serious’ conditions where the insurance company may decide not to bother with this stage of the process and to offer acceptance terms straight away.  In fact life insurance companies adopt this approach for the majority of applications.

The problem is that where there is no independent medical verification there can be an increased risk of misunderstanding and therefore of a claim being declined, which is potentially catastrophic for the policy holder.

Life insurance companies argue that if they were to write out for medical evidence in a greater number of cases that this would add to their costs and that it would delay customers obtaining cover. They say that customers want cover quickly and that if they can’t  get it quickly they will be put off taking out insurance.

We disagree strongly and so do most of our clients. We think that the argument that the ‘client needs a fast turnaround’ is a smoke screen and that there may be other motivating factors.

Here @MoneysworthUK our clients tell us that the most important thing for them is to know that their cover is valid. Getting the job done right is much more important than getting a quick fix. In the main they positively welcome a GP report as part of the underwriting process, because it makes them feel safer that they haven’t accidentally left something out. That’s probably not surprising when you consider that the majority of our clients already have an existing health condition such as diabetes, heart disease, mental health etc.

In the case of Nic Hughes, had the life insurance company written out to the client’s GP for a report before making their underwriting decision then the current situation could have been avoided. If they had declined or postponed cover then Nic could have explored other avenues to see if other options were available. Instead of which the insurance company seems to have taken the easy route which has turned out to be easy for them but very difficult for Nic and for his family.

In Nic’s case we think Friends Life should settle the claim. If you would like to sign the petition here is the link

Furthermore we think that Nic’s case illustrates the need for a reassessment of underwriting procedures across all life insurance companies. One possible way of dealing with this issue would be to make insurance companies fully liable for claims arising after a limited initial period – that would change the way life insurance companies approached their underwriting processes as they would not be able to rely on non disclosure at the claim stage. But it would leave customers knowing where they stand.

In the meantime until life insurance companies change their ways we think that ‘grey’ cases should be settled in favour of the applicants.


  • Jon Danzig says:

    The Consumer Insurance (Disclosure and Representations) Act, which came into force last month, removes a customer’s obligation to disclose all material facts. Instead, customers must take ‘reasonable care’ to answer the insurer’s questions fully and accurately. No longer can insurance claims be declined for non-disclosure unless information was deliberately or careless withheld or misleading. Many consider this is relevant to the case of Nic Hughes.

    A useful explanation appears at

  • Jon Danzig says:

    The refusal by Friends Life of Nic Hughes insurance claim for cancer would probably be illegal under next year’s new law on insurance applications and claims, coming into force next March. See my blog about this.

    Short link:

    • Anonymous says:

      No Jon – the new Consumer Insurance Act reinforces the position that Friends life are taking. If you don’t answer a straight question correctly – then you are inducing an insurer into a contract by misrepresentation, and the contract can be voided.

      And quite rightly so. If the case against Friends has any merit it should go to the Ombudsman – the fact that the family is being advised not to speaks volumes.

  • It’s a real shame that Friends Life are finding a way not to pay this claim. Unfortunately, it is unjust and disgraceful.

    As the days go by and there are now almost 50,000 who agree that this is wrong, I hope that Friends Life have the grace and capacity to do the right thing.

    I’ve listed a few ways we can take action

  • Anonymous says:

    Having read a little about this, it would appear the following:

    Nic submitted his application and based on that application he was asked further questions. I.e those questions were relevant as to whether Friends life would offer cover and whether they would load and if so by how much.

    Whether accidentally or deliberately, the answer he gave to two of those questions were wrong. Had he answered yes, then the cover would have been turned down.

    So although yes its harsh on his family, Nic obtained cover based on incorrect information.

    As such, Friends Life are absolutely correct to refuse to pay out. were they to do so, then effectively they would be saying, yes its ok to lie on applications.

    • Thank you for your comment.

      As we say in the blog (and in previous posts) we do not condone deliberate non disclosure. But based on the information in the Observer article we think it is not sufficiently clear that the applicant diberately tried to hide relevant information.

      What we are saying is that it would have been clearer and better for all concerned had Friends Life contacted the GP for a report before making an underwriting decision.

      Most clients are not as medically expert as their doctors. Moneysworth are specialists in helping with people who already have health conditions to find life insurance and as such we often come across situations where clients misunderstand or are not fully aware of aspects relating to their medical conditions.

      For example sometimes we come across someone with diabetes who thinks that the reason they are taking a statin is to control their diabetes or perhaps to control their blood pressure, whereas it is a medication to help control cholesterol.

      Another example would be some clients with diabetes who might not mention at the application stage that they also have a kidney function issue, which may well be because their GP has made a deliberate decision not to tell them.

      It is not surprisingly therefore that for the great majority of applicants with diabetes the insurance companies will write to the GP for a report. We think this is good practise and makes sense for all involved.

      One final point – you seem to be saying that whether non disclosure is deliberate or accidental it is still lying. But getting things wrong without intent is not the same as lying (in fact it is part of the definition of accidental) and as such deserves to be judged differently.

    • Anonymous says:

      You make a well-reasoned case, but as a policyholder of Friends Life, who answered that ‘pins and needles’ question myself, it could not have been more clear (and I have the copy application to jog my memory). It is a ‘yes’ or a ‘no’ to symptoms that are often associated with MS.

      As you will know the Consumer Insurance Act shortly comes into force and even under this new legislation, freshly passed by Parliament, Nic Hughes would still have needed to answer the question correctly – and even if his answer was in error, the contract would still be voidable if the answer was sufficient to have meant the insurer would not have entered the contract on those terms.

      However it is not on that basis that I strongly disagree with your position (there is much to be said for your views on medical evidence). I object because the family are apparently being advised not to go to the Ombudsman, or to law (presumably because the solicitor realises their case is weak). So instead they are seeking to get their way by raising a web-mob. this would be an extremely dangerous precedent if it were to succeed. We receive justice in this kingdom by due and fair process, and whilst I accept that there are occasions where direct and peaceful protest is warranted – this should be when due process has been exhausted, not because it is viewed that bullying would be a more fruitful approach than independent ajudication.

      As for Friends – it might have been that they would have been prevailed upon to show some mercy (though as a policyholder I expect them to use objective measures in deciding a claim)if this had taken a quieter course. the campaign has made it impossible for them to concede, and if they do …well we will all have been diminished by the triumph of digital pitchforks over due process. We will know that justice is not even-handed in this country – it will belong to those who have the biggest twitter following.