CIC commonly pays out a lump sum if an individual is diagnosed with specific specified conditions. Most sales of CIC are made to consumers taking out a mortgage. While CIC could be bought as a stand-alone item, typically it’s taken as component of a term assurance policy.

Several sales are produced on an advised basis following a full assessment of the individual customer’s economic requirements. Overall, CIC sales have been in decline – falling by around 30% in between 2002 and 2004.

Firms selling Critical illness cover (CIC) are generating efforts to meet needed standards but a new survey reveals they require to do a lot more to show they’re treating clients fairly and helping them to have a far better understanding of the product.

Visits to firms and mystery shopping exercises by the Monetary Services Authority (FSA), have particularly looked at how compliant firms‘ sales processes function when selling CIC.

Nonetheless, FSA Director of Retail Firms Sarah Wilson, said the survey had quite a few positive findings but also recognised some troubles. „CIC [as a product] has launched initiatives to deal with them and to assist inside the fair remedy of clients, specifically to make policy documents and applications forms clearer. It can be early days but these seem to be getting a positive effect. „However, our perform confirmed a number of the compliance concerns we already identified last year within the context of perform on the economic promotion of CIC and on general insurance documentation. As CIC could be complicated, firms at times have trouble finding shoppers to know what they’re purchasing.“ This lack of understanding makes it challenging for prospects to create a judgement about regardless of whether CIC the appropriate product to meet their protection requirements as opposed to a payment or income protection policy.

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