The whole truth: consumers admit lax attention to policies

Renewed attention needed at point of sale.

Canadians aren’t dotting the i’s or crossing the t’s when it comes to their insurance policies. Most insurance shoppers–especially younger ones–aren’t too sure what they’re getting when they sign a new insurance policy, reports TD Insurance.

The vast majority of insurance consumers–82%—don’t read their policies properly, and one in four aren’t sure exactly what their policies cover, according to the insurer’s latest survey. The State of Insurance 2011 report reveals mixed behaviour when it comes to applying for, and signing off on, coverage.

Just under a third of respondents (31%) say they don’t read their policies at all, and slightly over half (51%) say they only skim their policy. Those who put the policy away right away were less sure about their coverage (40%), but an almost equal amount of those who went over the policy (38%) said they knew what they had covered.

What’s more, many aren’t telling the whole story when they fill out an application: 21% acknowledged leaving out pertinent information or even lying when completing the forms.

That’s putting coverage for many Canadians at risk, says Henry Blumenthal, vice president and chief underwriter at TD Insurance. Not only does it affect the kind of policy consumers get, it could also come back to haunt them at claims time.

“Whether intentional or not, failing to disclose important information to your insurance provider can put your insurance coverage at risk,” he said in announcing the findings last week.

The results also indicate the need for renewed attention at the point of sale–for both buyer and seller, he said.

“Just like you wouldn’t buy a car without knowing what features you paid for, it’s important to understand what’s covered by your insurance. It can save you from costly headaches in the event that something unexpected happens.”

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