FCA is concerned that consumers with pre-existing conditions find it difficult to access the specialist travel insurance market
The Financial Conduct Authority (FCA) has today challenged the insurance industry to provide better access to insurance for people with pre-existing medical conditions.
The regulatory body says it is concerned that consumers find it difficult to access the specialist travel insurance market.
Therefore, it will start to work with industry stakeholders to create a new service which will redirect customers to specialist providers.
Christopher Woolard, executive director of strategy and competition at the FCA, said: “People with pre-existing medical conditions feel poorly served by travel insurance. There are specialist services out there, but, often, people don’t know where to find them. We’ll work with industry to point people in the right direction and help dispel some of the myths and misunderstandings to ensure this market works better.
“This will also form part of our continuing our work on insurance pricing practices which are designed to lead to long-term positive changes across the market.”
Call for Input
In June 2017, the FCA issued its Call for Input, which saw it gather evidence and decide how to address consumer concern about people with pre-existing conditions’ access to affordable travel insurance.
From the report, most stakeholders felt that it could be difficult for consumers who have, or have had, pre-existing medical conditions to find affordable travel insurance.
The report found that:
- Consumers felt uninsurable after finding a lack of information or alternative options after being given a high quote,
- There was a lack of understanding between firms and consumers on terms and the risk factors that are considered by providers when calculating the premium
- A lack of transparency about pricing and how it is calculated, leading to consumers having difficulties in finding competitive insurance that is appropriate for their medical condition
The Chartered Insurance Institute (CII) has welcomed the findings of the FCA.
Melissa Collett, professional standards director at the CII, commented: “We welcome the regulator’s call to improve access to insurance for people with cancer and other health problems.
”One in three people living in the UK are likely to get cancer at some point in their lives and it is absurd that this large group are prevented from travelling because they cannot get insurance or worse, forced to risk travelling without it.
”Many people living with cancer and those in remission live healthy and full lives and we should be doing all we can to support them in this.”
She continued: “This paper highlights the need for consumers to seek specialist advice if they have pre-existing conditions to ensure they have the cover that meets their specific requirements.
”The sector needs to work together to find solutions for customers who have different needs, and improving signposting would help enable more people to be covered for the moments that matter.”
Macmillan Cancer Support’s executive director of policy and impact, Fran Woodard said:
“We welcome these commitments to make it easier for people with cancer to find suitable travel insurance, but we are disappointed these proposals do not go even further. Improved signposting will only benefit people with cancer if, at the end of it, there is fair and affordable cover available. As it stands, this is rarely the case.”