The IFA Association’s critical illness working party is setting up an extra working group to decide on standard definitions for more life-threatening illnesses, following repeated requests from life offices and IFAs.
It was recommended over 18 months ago by the Office of Fair Trading that critical definitions should be expanded.
The working group will comprise representatives from the existing critical illness working party, including IFAs, reinsurers and life company representatives. It will be spearheaded by Nick Kirwan, product development manager at Pegasus.
Currently every company operating in the IFA market must offer a minimum six definitions which were decided on four years ago.
These definitions include heart attacks, strokes and cancer. But a requirement for increased clarification, combined with significant surgical developments, has resulted in the need for a major reappraisal of definitions.
The new division of the working party will decide what extra illnesses to include in policies as standard.
Pundits in the critical illness sector claim the present amount of illnesses defined in the cover could be more than doubled. Those ear-marked for inclusion are sight and speech loss, as well as multiple sclerosis.
Paul Cowman, assistant chairman of the critical illness working party and a risk product manager for Guardian Financial Services, said: “An OFT report produced a few years ago cited the need for additions to be made to definitions, so this is not new ground for us.”
If the changes are not implemented soon, it is believed the OFT could insist on these alterations to be made.
Cowman, believed that although the working party hopes to have finalised recommendations within the next couple of months, the standardisations will not be implemented for six months.