Desire for ‘perfect insurance self’ leads South West residents to non disclose

A recent research report by YouGov that was commisioned by AXA shows that almost one in ten of South West residents who have ever taken out a life, critical illness or income protection policy has knowingly misled their insurers when completing application forms.

In a desire to present their ‘perfect self’ to insurers and keep their policy premiums low, one in twenty of those that have insurance in South West have stretched the truth about their weight, while 14% admit to hiding details of their alcohol consumption levels.

In total, 7% of Brits who have taken out insurance have misled their insurers about their lifestyle habits and previous medical conditions, despite the fact that a number of these conditions will not necessarily affect their premium. Effectively, this means that 1.5 million people in Britain potentially face having their claim declined should they need to make one.

· The most common insurance inaccuracy is about alcohol intake – particularly in the South West where one in seven insured people have non disclosed the amount of alcohol they consume, compared to 2% of those in the East Midlands

· Over one in six people in the South West that have ever been insured didn’t disclose their smoking habits when completing an application

· Women in Britain (more than one in 10) are almost twice as likely not to disclose their real weight than men

· In Britain the younger generation are the most likely to be inaccurate, with more than one in nine 18-34 year olds admitting to this, while the over 55s are the most accurate

· One in 15 of South West residents didn’t disclose previous or current back problems and 2% misled their insurers about blood pressure problems

The research shows that a series of non-disclosure myths surrounding insurance costs and health and lifestyle habits are discouraging many people from protecting themselves. Today, less than half of locals (48%) have any form of life insurance, critical illness, health insurance or income protection to cover themselves and their families if things should go wrong.

AXA points out that 75% of the British population incorrectly believe that they will face hefty premium increases if they disclose certain lifestyle habits or medical conditions (particularly men who were more likely than women to believe this). For South West residents in particular, people believe high blood pressure controlled by treatment (48%), high cholesterol levels controlled by treatment (43%), mild asthma related to smoking (44%) and taking drugs in their past (51%) would result in high insurance premiums.

Those living in South West also believe depression controlled by treatment (37%) or back problems (27%) would increase the cost of insurance payments, and a quarter of people (25%) thought they would be penalised through their premiums if they had ever previously contracted a sexually transmitted infection. While these conditions are likely to affect a large level of the population, AXA confirms that they are unlikely to have significant impacts on their premium costs and in some cases will have no impact at all.

AXA believes that the reasons people continue to mislead their insurers are based on misconceptions about how insurance works.  Iain Mallon, Head of Protection at AXA said:  “Most people quite rightly assume that insurance premiums are based on medical history and certain lifestyle elements. What people wrongly assume is that these normal behaviours and typical medical conditions are based on that of a perfect person, one with a healthy lifestyle and no medical problems at all. In the UK today 53% of people are overweight, one in five people suffer from depression, 80% of us suffer from some form of back pain and 50% of people in the UK have high cholesterol, which shows that the perceived perfection is not necessarily the average upon which insurance comparisons are based.

“Insurers are not looking for reasons not to pay out. Our business is designed to support people not constrain claims. However quite simply if your insurer finds out you have deliberately non disclosed relevant information, they may not be obliged to pay out the full amount. Insurance policies are there to protect people in times of need, without this reassurance in place, people may find themselves in a very difficult position.”