The Financial Conduct Authority (FCA) has published Call for Input: Access to Insurance which seeks to better understand how customers with cancer can access travel insurance and other insurance products.
In May 2016 the FCA published Occasional Paper: Access to Financial Services in the UK, which identified various trends in terms of access to financial markets. One trend identified was evidence of an increasingly segmented insurance market, particularly where customers who fell outside the “standard risk” profile were unable to access cover. The FCA’s concern is that segmentation is increasing as more underwriters use ‘big data’ to support their underwriting. According to the Call for Input increasingly segmented underwriting approaches are “present and significant in the travel insurance market for those with pre-existing medical conditions”. In particular, individuals with, or who have had, cancer face problems getting access to travel insurance. Although the Call for Input focuses on problems for those with cancer, the FCA believes that findings can be read across to other pre-existing medical conditions.
The FCA has worked with stakeholders such as Macmillan to help determine the extent of the barriers people face buying travel insurance when they have cancer. The level of demand for information and guidance on travel products indicates that access to insurance is a problem requiring more work by both the FCA and the insurance industry.
The FCA reminds firms that cancer and other long-term conditions and disabilities fall within the protections set out under the Equality Act 2010. Accordingly, any differential treatment of customers with cancer or other disabilities must be based on relevant and reliable information which would justify the difference in treatment.
What are the FCA looking for?
The FCA is seeking help to understand the following:
- What are the current challenges in providing travel insurance for customers who have, or have had, cancer?
- What are the challenges consumers who have, or have had, cancer face in accessing the travel insurance market and in finding suitable travel insurance?
- What innovation is taking place?
- What are the barriers to dealing with existing challenges to innovation?
- What more can be done to improve the ability of consumers that have, or have had, cancer to obtain suitable insurance?
What next?
The FCA wishes to receive responses (supported by examples and evidence where possible) from respondents in relation to a number of questions set out in the Call for Input. Responses should reach the FCA by 15 September 2017. A feedback paper will be published later in the year.
