Nor, he said, would it allow clients to take out a new policy to run alongside the existing policy.
Lindsay, a life and disability insurance broker who says he has sold reasonable volumes of Asteron’s (formerly Royal and SunAlliance) policies, claimed then the edicts flew in the face of the policy itself and the marketing used to sell the policies.
Brian Young, Asteron’s marketing and communications manager, says after discussing the matter Asteron has agreed to allow policy holders to take out a new policy to run alongside any existing one they have.
He says the decision affects people with contracts covering disability, or potentially around 100-200 people.
“Asteron will not upgrade the old policy, but it will allow a new one to run alongside,” Young says.
“What we, along with the rest of the industry faced was an issue of profitability. It could be argued that at the time the policies were released, they were priced too generously. The claims experience we have now shows the market has moved on.”
Lindsay says he accepts that and says some poilicy holders have made large claims, particularly under the stress and depression cover in the Loss of Earnings and Income Plan.
“I have no hard data that proves claims have outstripped what Asteron’s (the former Royal SunAlliance) expectations were, but it would be realistic to assume that they have been greater,” Lindsay says
Reinsurers have obviously punished the industry for the level of claims under old policies, he says.
Young says Asteron recognises that it must do better in managing cases such as those that fit areas where the duration of the claim is not easy to work out, such as back injuries, or depression.
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