As it announces its claims report, Aviva says it paid over £3.6bn in the UK alone

As it releases its claims report for 2017, Aviva is urging other UK insurers to do their bit to help debunk the myth that insurance doesn’t pay and to help consumers better understand how claims work.

Aviva has said it accepted 96% of all claims in 2017 and paid out over £3.6bn in the UK alone, the equivalent of £7000 every minute.

Consumer research commissioned by Aviva found that around 55% of consumers believe insurers will always try to find a way to get out of paying claims.

Nearly one million claims were accepted (961,973) in 2017 across home, motor, travel, protection, health and commercial lines.

Claims director, Andrew Morrish, speaking to Insurance Times: ”We want to show people that this just simply isn’t the case in our experience, that is why we have decided to publish this report, and we would urge other companies to do the same.”

The other 4%

With 96% of claims accepted, that leaves 4%. Morrish outlined the reasons these claims were not accepted.

”Some haven’t been paid because customers haven’t got cover.

”So if you look at household claims, some people have chosen not to cover things away from the home, then they lose something away from the home, we just can’t do anything to help them because they just chose not to have that cover.

“Then, another reason is simply that the claims are below their excess. Often that is used as a mechanism to reduce the premium, so when it comes to making a claim, you don’t get the help that we would have liked to have been able to give you.”

Whose responsibility is it to make sure customers understand what is and isn’t covered

With the wording of policies constantly coming under scrutiny from consumers and regulators, alike. It has long been the intention of the industry to simplify the often daunting document down.

But is it also down to consumers to have a better understanding of the insurance they are agreeing to?

“I think it is a dually-owned responsibility,” said Morrish.

“One of the major things we are focussing on is how we make our products simple, how we reduce the risk of customers falling between the cracks because they didn’t understand what they had bought.”

A recent study by the University of Nottingham and law firm Brown Jacobson found that up to 90% of consumers cannot understand insurance policies and that for some, you needed a doctorate level of education to fully understand.

Morrish continued: “We are spending a lot of money having fewer variations of our products, but also changing the wording. We are trying to speak more the customer language rather than the insurance language.

“So, there are things we could do, and we are trying to do them. But, there are things that we want customers to be tuned into. That is why talking about why claims aren’t paid, allows customers to be more tuned into the process of claims.”

Debunk the myth

As part of the report release, Aviva would like to encourage more insurers to announce their claims results.

Aviva UK chief executive, Andy Briggs said: “Misconceptions that insurance does not pay out when it is needed or that it is unnecessary are leaving UK families and businesses potentially exposed through a lack of suitable insurance. If people have a sense that insurance is not going to pay out, they won’t bother buying it.

“Across the industry, we know that insurance is a reliable and critical way of providing financial protection when things go wrong, whether it involves a family member, a personal possession or a business.

”In the vast majority of cases, insurance claims are accepted and there are additional and very important support services that help customers get back on their feet.

“When it comes to making a claim we want Aviva customers to feel really clear about what they are covered for, so we are actively looking at ways that we can help them understand their cover in a simple and unequivocal way.

”This is something that we believe the whole industry needs to commit to on behalf of customers.”