UK insurance company Norwich Union has warned that too many people are risking their families' financial security by failing to disclose all relevant information on medical insurance application forms, leading to the rejection of claims.
A study conducted by the insurance provider identified the main conditions which caused the non-disclosure when completing insurance application forms included: smoking status and alcohol consumption, episodes of depression and whether they had received any form of treatment in the past 12 months.
Part of the reason for this is that many believe that insurers will automatically obtain full medical records when the policy is taken out. However, insurance companies rely solely on the information provided by the applicant.
Medical history is only referred to when a claim has been made or if an application form highlights an issue that requires further information before underwriting the policy.
Tony Jupp, chief underwriter at Norwich Union, said: It is vital that people take a great deal of care and attention when completing these forms as the information they provide will form the basis of any life policy that they are offered. If applicants don’t share with their insurer information that is requested, it is likely that they will have invalidated their policy and if they make a claim, it might be turned down.
In 2005, Norwich Union declined 12% of critical illness claims as a result of non-disclosure.