Access to insurance in the UK has markedly improved in recent years.
However, there are inconsistencies across the market, with accessibility dependent on the underwriting philosophy and ethos of the provider; primarily the flexibility to think outside the box.
And it can sometimes come at too high a price to make cover a viable option for the individual.
These are problems the European Commission’s (EC) Right To Be Forgotten and Beating Cancer Plan were designed to fix; legislation that has been applicable to life insurance in certain countries for a few years and was recently taken up, on a voluntary basis at least, in Ireland.
The legislation does not currently apply to the UK, but that does not mean we should not be cognisant of what is happening elsewhere; the whys, the wherefores and the potential pros and cons to customers.
On the face it makes total sense for customers. But, as with all things, there are downsides too.
“Interestingly for life insurance, a Right To Be Forgotten rule is not really going to benefit people who have had lower grading cancers, stage one or two, as most people would get standard premiums anyway,” explains Cura Financial Services managing director Alan Knowles.
“The people it would really help are people who have had stage three or higher cancers and people who have had metastasis or recurrences, and of course people seeking critical illness where underwriting is stricter.
“While it would be brilliant to see people who have had such cancers get cover easier, we can’t ignore that it would present an increased risk to insurers, so the likely outcome is that premiums may need to increase for everyone to help cover the cost of the pooled risk.
“Overall, I’m generally supportive of such a rule, but we can’t ignore that there will be wider implications if it does come to the UK.”
Current state of play in UK
So, how is the UK faring on access to insurance these days?
It’s fair to say great strides have been made, notes Duncan Reeves, head of underwriting and claims at National Friendly.
“Although it varies from provider to provider, it’s possible for exclusions on health and protection to be reviewed and removed over time, such as those related to bereavement and work-related stress,” he says.
“And it’s even possible for those with a long-term condition, such as Rheumatoid Arthritis or HIV, to obtain cover; unthinkable a few years ago.
“However, there’s very little consistency in the market and the ability to keep premiums affordable depends on many factors, including whether the provider can diversify its own risks across various products.”
It is with barriers and inconsistencies in mind – and a laser focus on cancer primarily – that the Right To Be Forgotten was introduced in several European countries, and its scope broadened to chronic conditions in one particular case.
Why cancer?
Well, better treatment and early diagnosis has meant that, the number of people living after a cancer diagnosis has been increasing for the past 30 years.
So, the thinking goes, is it fair and reasonable that insurers, when calculating premiums, consider medical information on cancers that occurred more than five or 10 years ago, with no recurrence in that time?
Or could, or perhaps should, they do more to ensure the quality of life of a cancer survivor by ensuring access to necessary insurance services?
The European legislation
In February 2021, the EC published Europe’s Beating Cancer Plan.
This was designed to improve access to life cover, along with travel and loan applications, for cancer survivors across Europe; although the extent of access and type of insurance varies by country.
Access to financial services was explicitly referenced in this plan.
In the case of life insurance, access can be made more difficult by insurers declining coverage or by greatly increased premiums for cancer survivors, even if the cancer has been in remission for a long time.
The EC therefore introduced the Right to be Forgotten (RTBF).
This states that insurers may not consider medical information for conditions, mainly cancer at the moment, that occurred more than a defined period ago, usually five or 10 years.
The RTBF has been effective in France since 2016. It later came into force in Belgium, Luxembourg and the Netherlands, and more recently, Portugal and Romania.
In Italy a proposed legislation is currently in front of the senate.
It is worth noting that Portugal has taken this a step further by including chronic diseases.
Portuguese law states that no information can be collected after two uninterrupted years of efficient treatment.
How might it affect the UK?
The UK does not currently appear to be considering implementing the RTBF.
But it is interesting to note that in June, Insurance Ireland recently announced a voluntary code of practice, applicable to mortgage protection insurance only, in line with the EU legislation.
If the RTBF is adopted across the whole of Europe, there might well be pressure on the UK to implement it too.
Is it only a matter of time?
