Letter: BMI
I read with interest the BMI article 'Measuring Up' in the December 2006 edition of COVER.
I am amazed - doesn't anyone realise that what is happening here is an argument in favour of even longer application forms? One week industry experts seem to be calling for shorter application forms and the next week they are suggesting more questions are asked. What a merry go round; clients measuring their waists - what an absolute minefield for non-disclosure that is. At least it wasn't suggested we should take a picture of our clients in their underwear.
What the insurers are doing, whether they realise it or not, is finding yet more ways to make life insurance a little bit cheaper for the minority but more expensive for the majority, so they can seem more competitive on the portals with their 'standard' rates.
However, fewer and fewer applicants will actually get these rates.
Life insurance was originally intended to spread risk, so that the majority could regularly pay a small amount of money to provide a large payout to the minority that had to claim.
Preferred lives, uninsurable underclass, call it what you will, but is it treating customers fairly to publish, as 'standard', a rate set that only 70% (and shrinking) of applicants get?
What the industry seems intent on doing is racing to a utopia where only those that won't die can get insurance, a bit like selling umbrellas, but not if it looks like rain.
Jason King
Managing director
Torquil Clark Life Insurance
