E-only protection provider Royal Liver has issued a scathing response to the proposed changes to critical illness (CI) insurance definitions by the Association of British Insurers' CI Working Party.
Issuing a statement following a meeting of the Personal Finance Society to agree an official response to the party's recommendations, the Merseyside-based insurer accepted that a review of the current definitions was necessary, but expressed concern that "some of the changes proposed do not meet the working party's objective of improving clarity".
The insurer warned against rebranding, since "changing the name would probably attract more bad coverage for the product, with the potential for the media to be able to accuse the industry of trying to engineer a cover-up".
The statement also slammed the working party's proposal to introduce a two-tier cancer definition, not only for the confusion it would cause, but also because of the possible detrimental effect it would have on the quality of advice customers receive.
"The adviser, no doubt after the best advice recommendation, will be moved to recommend the more comprehensive definition, therefore making the less costly definition irrelevant," the response read. "We can only see direct providers who enter the market based on price taking advantage of the cheaper cancer definition. Customers could potentially be offered the cheaper alternative and decide to buy it without having received advice on the product to best suit their needs."
The document did support some aspects of the review, however, including the addition of Alzheimer's and HIV as covered conditions and the establishment of a standard sentence in all CI product literature.
