The Association of British Insurers (the ABI) has recently published a consultation paper on its statement of best practice for critical illness cover. Please click here to view the consultation paper. The ABI originally published the statement in 1999 following a report by the Office of Fair Trading on health insurance. The aim of the statement is to ensure that customers continue to get meaningful, understandable and affordable critical illness cover that meets their needs. The ABI reviews the statement every three years to ensure that it continues to meet its objectives and that the standard medical definitions and other provisions remain appropriate.

The consultation paper builds on the proposals that emerged from the ABI’s review of the statement in 2009. In particular, it outlines the ABI’s proposed new name for “Total Permanent Disability”, which is “Irreversible Life-changing Disability”, and the proposed new standard definition. It also sets out the final revised definitions for cancer, Parkinson’s disease and terminal illness and introduces a standard wording for the pre-existing conditions exclusion used in children’s critical illness cover. The ABI has noted that insurers are free to adopt these definitions from now on. Alternatively, insurers can wait to adopt them together with the other revised provisions that will be included in the final revised statement. The final revised statement is expected to be published during the summer.

Comments can be made on the ABI’s proposals until 30 June 2010.