Press release

AEGON welcomes ABI announcement on new measures for non-disclosure

10 January 2008

AEGON today welcomes the ABI announcement on changes in the treatment of protection claims where medical information has not been fully disclosed.

The ABI has introduced three high level categories of non-disclosure which aim to improve customer clarity and certainty around paying claims for protection policies. This aims to reduce the proportion of declined protection claims across the industry.

The three categories, which replace previous guidance by the ABI are innocent (resulting in the claim being paid in full), negligent (applying a proportionate remedy) and deliberate or without any care (resulting in a declined claim).*

Non-disclosure remains a fundamental issue for protection market and AEGON believes that these new measures will go a long way to increasing levels of full disclosure and in turn improving customer trust and confidence in the industry.

Rod McKie, Head of Marketing, Individual Protection for AEGON Scottish Equitable said:

“This is a very positive announcement by the ABI and it makes absolute sense to have the one category of ‘negligence’ whereas previously there were two.

“These changes do not reduce the importance of full disclosure and these measures do not mean that people can be more relaxed in their disclosure. AEGON works closely with advisers to encourage full disclosure and will continue to do so in the future.

This new approach assures customers that product providers will never actively try to avoid paying a claim. In fact the new proportionate payment approach will increase payments across the industry.”

Notes to Editors

ABI Guidance notes on Non-disclosure and Treating Customers fairly for Long-term Protection Insurance products. Source ABI press release.

Category	Explanation	Outcome
Innocent	The customer has acted honestly and reasonably in all of the circumstances, including the customer’s individual circumstances but only where these were known to the insurer In the circumstances, a reasonable person would have considered that the information was not relevant to the insurer The non-disclosure would have resulted in a different underwriting outcome	Pay the claim in full
Negligent	Applies where the non-disclosure resulted from insufficient care – the failure to exercise reasonable care. This includes anything from an understandable oversight or an inadvertent mistake to serious negligence. In the circumstances, a reasonable person would have known that the information given was incorrect and was relevant to the insurer The non-disclosure would have resulted in a different underwriting outcome	Apply a proportionate remedy
Deliberate or without any care	Only applies where the non-disclosure was deliberate or without any care In the circumstances, on the balance of probabilities, the customer knew, or must have known, that the information given was both incorrect and relevant to the insurer, or the customer acted without any care as to whether it was either correct or relevant to the insurer The non-disclosure would have resulted in a different underwriting outcome	Avoid the policy (decline the claim and cancel the policy from inception)

AEGON Scottish Equitable is a leading provider of protection policies including life assurance, critical illness cover and income protection, with over 300,000 customers.
AEGON UK has assets under administration of £52.3 billion and employs around 4,000 staff. AEGON UK is part of the AEGON Group, which is one of the world’s largest listed insurers and has assets under management of £245 billion.

For Further information

Kevin Brown
AEGON UK
T. 0131 5492859 | M. 07740 897282
kevin.brown@aegon.co.uk

AEGON UK

AEGON welcomes ABI announcement on new measures for non-disclosure

Notes to Editors

For Further information

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