I thing the first thing to realise is that full disclosure benefits not only the insurance industry but the customers. The only way insurers can reduce premiums is by having control over claims.
Life insurers are in the business of of paying claims. For example Irish Life claim 98% of claims are paid. Other insurers may experience 97 to 98% claims paid. But they want to get these figures even higher because it demonstrates trust.
Fraud is rare but high profile cases give the insurance industry a bad name. Of the 2% to 3% of non pay outs I’m afraid none were accidental non-disclosure.
On an application form for life assurance or mortgage protection cover a person may put that they are a non smoker when in fact they are a smoker. Non smokers pay less for insurance.
Someone may understate their weight so their BMI appears better than it actually is.
Ireland has a reputation for consuming high amounts of alcohol yet from what I see on applications coming in this statistic isn’t reflected in the average units of alcohol people state they consume. It almost seems like we are a nation in denial.