Insurers more likely to reject higher life claims

According to research from threesixty, life insurance claims that are higher have more chance of being rejected by an insurer. In a survey of 12 UK insurance providers, threesixty found that 6.65 percent of life claims were rejected on average, with the rejection rates of individual providers ranging from 0 rejections to a 25 percent rejection rate. The average value of a rejected claim was £70,121 while the average paid claim was worth £60,172. The study found that the higher the amount of a claim, the more comprehensively it was investigated. This led to a higher likelihood that the higher claims would be rejected. 99.59 percent of the rejected life insurance claims were turned down for reasons of non-disclosure, while the rest were due to suicide exclusions.

The survey also looked at rejections for critical illness policies. There, threesixty found that the difference between rejected and accepted claims was smaller and that paid claims averaged a higher value than rejected claims. The average claim paid was worth £64,856, while the average amount of a rejected claim stood at £60,635. More critical illness claims, however, are rejected, with 16.89 percent of claims turned down. 58.06 percent of the rejected claims were due to non-disclosure, while the rest were turned down because the conditions claimed were not covered by the policy.

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