Category Life Insurance

Great strides made with exclusions grid (III)

01 November 2007 National Financial Partners (NFP)

Freddie Andalaft, CEO of National Financial Partners (NFP) is pleased to announce the release of Exclusions Grid (III) to Independent Financial Advisors, Product Providers and the Media.

"This year we have made significant strides forward, and we applaud the Product Providers that aligned themselves to the objective of this initiative." says Andalaft.

AltRisk (Hollard), continue to separate themselves in the advanced structuring of their policy wording, making more room, for less ambiguity. Acknowledgement must also be given to this years improvements made by Liberty and Metropolitan Odyssey.

Respective updates have been made by the participating product providers on:
*death benefit exclusions, disability exclusions (general), definitions of hazardous sports or pursuits, change of occupation, residence and activity after inception of policy (for disability & death benefit), dread disease benefits

We believe that yet again, a valuable tool is made available to the broker fraternity, that has a common alignment of purpose, from all participating parties.

This tool has been structured to assist brokers in their consultation process with their clients. The NFP Exclusions Grid (III) can be downloaded from our website

NFP will be hosting the 3rd Annual NFP Exclusions Grid Panel Discussion with invitations extended to Altrisk, Discovery, Metropolitan, Odyssey, Old Mutual, Momentum, Sanlam and 1 Life Direct, to participate on the discussion panel.

The forum will be held on 20 November at the Venue, Melrose Arch and commence at 09h30 for 10h00 and conclude at 11h30 for snacks and refreshments sponsored by the participating companies.

Brokers must please RSVP to, tel (011) 201-7200, or fax (011) 455-1300 to register.

Once again, this session will serve the purpose of being both an informative and educational session for product providers and brokers alike, we invite all brokers to attend this session. This is an open forum for brokers to obtain information directly from the panel of life company actuaries and officials.

Extracts taken from - A Brokers "wish list" at the NFP Exclusions Grid 2006:

1. Product Providers across the board need to talk to brokers more regularly, the need is there for any changes to be communicated on an ongoing basis, to keep the broker up to date with current changes.

2. Product Providers should start shifting their focus to brokers and treat their contracted brokers as their clients and not merely as a link in the value chain.

3. Product Provider legal teams should get together and draw up a standardized industry risk/exclusions document with clear definitions and interpretation of policy wording/definitions, allowing brokers to be able to follow a common understanding of risk/exclusion clauses.

4. Product Providers should make their exclusions readily availablethe creation of an exclusions library (possibly on a neutral website ) to which brokers will have access.

5. Brokers need a public domain where claim repudiations can be accessed (Ombudsman), with full detail of the repudiation and the insurers name.

6. Product Providers should not exclude the client, they should load the premium

7. Product Providers should introduce short and easy to understand policy documents across the board

8. Product Providers should not dispute claims on unrelated risks (i.e. a client is killed in a car accident, but the claim disputed due to HIV status)

9. Product Providers should add their exclusions to their quotes

10.Product providers must include exclusions in their training and accreditation material.

At the last forum in October 2006, brokers appealed to the companies to standardize and simplify their definitions in their policies. This poses a significant challenge to them, and whilst the LOA have a committee in place to deal with such matters, we have not seen any progress on the subject.

"If the short term industry were able to come up with the MultiMark III policy, then the industry could standardize and at least agree on the interpretation of definitions. It is impossible, for the average policyholder to understand the complexities and variances of all the definitions described in life assurance policies". says Andalaft

The next item on our agenda is to obtain facts of repudiations from the Ombudsman of Long Term Insurance. Under FAIS, financial planners are obligated to be informed on the risks associated to the products they recommend and if they are not exposed to the reasons for repudiations they could be held responsible as ignorance is not considered when it comes to the FAIS Ombud.

"Although we are delighted at the vast improvements we are witnessing, the broker community continues to stress that whilst the NFP Exclusions Grid offers greater clarity for them and their clients, brokers continue to be bewildered by the vast number of interpretations of the array of definitions, we ideally need to standardize definitions", says Andalaft.

Click here to view the grid (PDF file 428 KB)

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