There are no easy solutions to the problem of overcoming barriers to income protection cover for customers with less than two years of GP records.
This is according to a protection insurer Health & Protection spoke to after Sheun Oke, CEO at Emergenzz Financial Services, (pictured) took to LinkedIn to express her exasperation at not being able to secure income protection cover for some of her customers who have come to the UK to work in the healthcare sector but have less than the required two years of GP records.
Influx of health workers from Africa denied cover
Elaborating on the issue, Oke told Health & Protection that across the protection sector, insurers are declining income protection cover for these reasons.
“That means all the people who are coming from other countries. We have an influx of healthcare assistants coming to this country from Africa. I have educated them. They know why income protection is important.
“If they don’t have health challenges and have a clean bill of health, why can’t we put them forward for screening and get them income protection?”
Settling for sickness policies
But Alan Knowles, co-managing director at Cura Financial Services, told Health & Protection some insurers even require three rather than two years of records.
“So for someone who moved over here on a working visa or someone who has relocated here, they have to have a UK GP for two years,” Knowles said. “We’re basically excluding them from getting an IP until they’ve had at least two years.
“They’ve got to settle for an accident and sickness policy, if they are eligible for one of those, which is kind of an inferior short-term version.”
Tricky situation
Though another adviser – Joanna Streames, owner of Velvet Mortgage and Insure Services, conceded that the issue is a tricky one for insurers.
“I do understand the reassurers needing that history to see back further. You would presume that the two year rule also would mean that the GP is asking for previous health history.
“I think you see more cases now where people are taking medical help more abroad. While a medical exam would check a lot of things right now, there are a lot of things it wouldn’t capture. Those things would most likely be the more serious type illnesses that could’ve happened in the past but are still a higher risk for the future, such as cancers, brain bleeds etc.”
Happy medium
Streames described the idea of using examinations to eliminate insurer concerns as a “good one,” and a “happy medium”.
“This could be something with a cap for these instances, a bit like a breathing space. British Friendly or LCP Aviva policy will give £1,000-£1,500,” Streames continued. “It could just have a sum assured max of £1,000 and a three month deferred period for example.
“I do think we should break down barriers, but also we have to be reasonable so that there are safeguards to potential abuse in place. Without these, prices go up for everyone.”
An ongoing problem
Alan Lakey, director at Highclere Financial Services and CIExpert, described the issue as “an ongoing problem”.
“I can understand insurers being fearful, particularly those who have come from countries with lower healthcare standards,” Lakey explained.
“A health screening would make sense, however that still enables some historic health problems to slip through the net.
“Perhaps charging a premium for the initial two years, which is then removed, would resolve the problem.”
Counterbalancing risk
Health & Protection approached AIG Life, Aviva, Cirencester Friendly, Legal & General, Lloyds Banking Group, Royal London, Vitality and Zurich for comment about this subject.
While AIG Life, Aviva, Legal & General, Lloyds Banking Group, and Zurich had not responded by deadline, Cirencester Friendly, Royal London and Vitality did respond to our media enquiry.
Sue Seymour, chief underwriter at Cirencester Friendly, maintained there were no easy solutions to solve this issue.
“The overriding reason why Cirencester Friendly seek a minimum of two years records with a UK GP is to counterbalance the risk of misrepresentation or non-disclosure,” Seymour said.
“Unfortunately, without access to UK GP records we can’t check an applicant or claimants’ history. This means we could be left vulnerable to claims, where if we had known all the facts, we’d perhaps not offered cover or added exclusions.”
According to Seymour, while in theory a health screening or a medical examination sounds like a good alternative, the difficulty is it will only give a snapshot of the individual on that day.
“It will not necessarily identify their full medical history,” she continued “For example, if they’ve had mental health or musculoskeletal problems in the past, these may not be revealed.
“We do recognise this is an issue for some people and have considered accessing records from outside the UK to overcome it.
No easy answer
“However, there are a host of problems associated with this, not least language problems, different medical systems, the reluctance of overseas doctors to send us information and the costs.
“Sadly, there is no easy, satisfactory answer to this. Rest assured, if there was one, we would have found it.”
Royal London revealed its customers applying for income protection cover are asked if they have been registered with a GP in the UK for the last two years, or if a minimum of the last two years’ medical records have been transferred to a GP in the UK.
“This two tier eligibility approach provides greater flexibility and wider access to income protection cover for customers moving to the UK from overseas,” a spokesperson for the mutual said.
“Having the medical information to hand means we can deal with any medical details or issues at the point of application and avoid surprises at claim stage.
“This protects both the customer and the adviser and avoids a situation where the customer is reassured thinking they have peace of mind from cover in place, only to be disappointed at the claims stage.”
In a statement Vitality said: “We strive to offer life insurance to as many people as possible who apply for one of our products, with every application reviewed and underwritten based on the individual and their medical history.
“Where a person does not have a UK GP, we would look to ensure we could have access to historical medical records if a claim was to be made.
“Where this is not possible, we would normally defer any application for two years.”