Independent dispute handler the Insurance Ombudsman Bureau (IOB) has said it will not recognise the “unreasonable” any occupation definition on income protection (IP) policies.
Although the ombudsman looks at disputes on a case-by-case basis, the bureau has taken this universal stance because it believes any occupation, which can force IP claimants into jobs for which they have neither training nor experience, is unfair.
For the IOB, any occupation has to stand for any-suited occupation, which covers any work to which people are suited by education, training, or background.
Any occupation cover has traditionally been the only IF option available to blue-collar workers. Along with the IOB’s position on the definition, ambiguity surrounding exactly what `any’ means has prompted providers to introduce an activities of daily working (ADW) system based on inability to perform basic tasks.
Norwich Union Healthcare is the latest insurer to announce plans for such a system, and its product marketing manager for IP Nick Homer said the company would be introducing an ADW-type definition in the near future. He believes such a move, which clarifies the criteria for disability, could help turn IP into a mass-market product available to house wives and house husbands.
IOB spokesperson Iris Baker said: “The ombudsman expects insurers to make consumers aware of exactly what policy they have, and any occupation is not sufficiently clear.
“It’s inappropriate if the definition means someone has to take on work for which they have neither training nor experience simply because they are capable of doing it.”
IF specialist IFA Diane Saunders said: “This certainly is a positive move but the ombudsman needs to go one step further and rule out the any suited definition too. That’s almost as ambiguous as any occupation, although the ‘suited’ does at least give people grounds for argument as to what is suitable work.”