When protection claims are declined, the headlines usually focus on the disappointment of customers left without support.
But behind many of those cases lies a quieter, systemic issue: misrepresentation.
The latest figures suggest that more than half of declined protection claims in 2024 were linked to inaccurate or incomplete disclosure.
The Income Protection Task Force (IPTF) estimates that 52% of declined claims last year involved incorrect or missing information. Data from LV= puts the figure even higher, with around seven in 10 declined claims tied to misrepresentation at the application stage.
Part of the solution is to find better, simpler ways to explain what we mean in the first place
For a sector built on trust, this is not just a technical problem but a reputational one. It undermines confidence precisely when customers and families need protection most.
And it raises difficult questions about process, language and responsibility across advice and insurance.
Problem of trust
“Any insurance policy is only as strong as the information it is built on, and trust is the number-one currency,” says Cover Direct founder Edward Durell.
“Clients must trust advisers to get the application right, advisers must trust insurers to deliver fair claims decisions, and advisers must be able to trust clients to disclose all relevant facts.”
Advisers need to ensure they record information faithfully, and, if unsure whether something needs to be disclosed, ask the insurer
Misrepresentation occurs when application details are inaccurate, incomplete or misleading. Some instances are deliberate, but much of the problem is accidental and avoidable, experts argue.
“It is very sad to see claims not paid, or only partially paid, due to misrepresentation, particularly with life claims when it is bereaved loved ones who miss out on receiving financial support at a time of real need,” says Protection Distributors Group vice-chair Emma Thomson.
She highlights advisers’ frontline role: “Advisers must ensure customers understand their responsibilities of disclosing accurately, which can sometimes include difficult conversations if they feel customers are not being truthful.
We have to take misrepresentation seriously — and that means changing how we all engage in the protection process
“Advisers also need to ensure they record information faithfully, and, if unsure whether something needs to be disclosed, ask the insurer.”
Rising cases
The rise in misrepresentation reflects both behavioural and structural issues.
Online applications mean more customers are completing forms without adviser support. Lengthy forms and medical jargon deter full disclosure. Cultural discomfort about discussing health or lifestyle factors also remains common, according to experts.
For Protection Review marketing director Roger Edwards, language is part of the problem.
Technology can help pick up patterns and trends in data
“Words like ‘misrepresentation’ or ‘non-disclosure’ might not mean anything to customers and therefore need to be explained,” he says.
“We also tend to use these terms during the claims process as reasons why claims are turned down, which just sounds like jargon or legalese. Part of the solution is to find better, simpler ways to explain what we mean in the first place.”
The Association of British Insurers has published a code of practice to help claim assessors deal with misrepresentation. The code classifies cases into three types:
- Innocent: the customer acted reasonably and honestly.
- Careless: the customer failed to take enough care, from simple oversights to serious negligence.
- Deliberate or reckless: the customer knowingly withheld relevant facts.
Most cases fall in the ‘careless’ category, making process design and adviser guidance critical.
Regulation and responsibility
The regulatory framework has evolved. The Consumer Insurance (Disclosure and Representations) Act 2012 shifted the onus onto insurers to ask clear, specific questions rather than expect customers to guess what was relevant.
The Consumer Duty, introduced two years ago, reinforced firms’ obligations to prevent foreseeable harm and support customer understanding.
Some of the ways we have focused on tackling misrepresentation include rethinking the questions we ask and how we ask them
“The Consumer Duty has helped ensure firms review their processes, procedures and documentation through a customer-centric lens,” says Association of Mortgage Intermediaries head of policy Stacy Penn.
“There is an opportunity for insurers to assess both the question set used and the overall application journey by working with advisers and customer focus groups.
“Where customers do notice errors in the information that’s provided, it’s important they can make corrections via a variety of communication methods, not just phone calls or putting it in writing. It’s important we make it as easy as possible for customers.”
Industry responses
The industry is beginning to act. In June, the IPTF launched an initiative offering practical guidance for customers, advisers and insurers.
Protection expert Phil Deacon, who is leading the work, is blunt about the scale of the challenge.
“If we’re serious about helping more customers get the support they need, we have to take misrepresentation seriously — and that means changing how we all engage in the protection process,” he says.
It’s important we make it as easy as possible for customers
The IPTF’s work reflects the fact that most misrepresentation is careless rather than deliberate. Insurers are adjusting accordingly.
“Some of the ways we have focused on tackling misrepresentation include rethinking the questions we ask and how we ask them to ensure our applications are clear and easy for clients to fill out,” says VitalityLife director of underwriting and claims strategy John Downes.
“We’ve also invested in data to identify patterns of misrepresentation, which helps us understand customer behaviour and share insights with advisers to improve quality.”
Any insurance policy is only as strong as the information it is built on, and trust is the number-one currency
Technology could also help bridge the gap. Tele-underwriting, digital factfinds and data-driven applications are being developed to make disclosure less daunting and more accurate.
“Technology can help pick up patterns and trends in data,” says Penn. “This insight can be used to flag recurrences of specific misrepresentations identified at claims stage and make improvements to the customer journey and positioning of questions.”
Closing the gap
Misrepresentation is not a niche issue. It cuts to the heart of how the protection industry explains itself, structures applications and supports advisers in difficult conversations.
For advisers, it means balancing empathy with accuracy and ensuring every disclosure is captured faithfully.
It is very sad to see claims not paid, or only partially paid, due to misrepresentation
For insurers, it means clearer language, simpler processes and greater consistency in claims handling.
And, for the industry as a whole, it means recognising that every declined claim corrodes the trust on which protection depends.
Momodou Musa Touray is senior reporter for Money Marketing
