How insurance policies can be turned into ‘weapons’ to control abuse survivors

Guides to help the insurance industry better support people experiencing economic and domestic abuse have been published by the Association of British Insurers (ABI).The guides were developed in collaboration with the ABI’s members, together with Surviving Economic Abuse (SEA) and the Employers’ Initiative on Domestic Abuse (EIDA).Economic abuse is a form of domestic abuse and may involve someone controlling another person’s finances, such as their money and assets, or their sources of income, such as employment.Abusers may also “weaponise” insurance and pensions products, for example by redirecting insurance claim payments to line their own pockets, or by forcing victim-survivors to make pension withdrawals.A perpetrator may cancel or amend home, motor, health, protection or mortgage-related cover without the victim-survivor’s knowledge, leaving them exposed to loss or debt when they need to claim.An abuser may also remain named on an insurance policy after a separation and try to use the joint policy to block the victim-survivor from accessing information, transferring cover or making changes needed.A perpetrator may also change contact details, intercept post or control online account access so that important policy information, renewal notices or claim updates do not reach the person they are abusing.Where firms require repeated evidence or consent across different teams, this can create further barriers and may force the victim-survivor to have to re-engage with the perpetrator or repeatedly explain the abuse.In some cases, a joint life policy may create a financial motive for a perpetrator to cause serious harm to their victim.Sam Smethers, chief executive of Surviving Economic Abuse, said: “Insurance products are there to protect us, but in the hands of a perpetrator they are used to cause real harm and in some cases this can be life-threatening.Read More“Thanks to our vital work with the insurance industry and the ABI’s leadership we are now beginning to see change, but there is still much more to do.“We urge firms to go beyond regulatory requirements by embedding good practice, strengthening staff training and importantly, designing products and services that close down opportunities for perpetrators to abuse instead of leaving all the power in the abuser’s hands.”The customer guide encourages training by firms beyond frontline customer-facing teams, to also include product, underwriting, operations, risk, compliance and senior leadership teams.Training should cover more than customer conversations, to also include account activity, product misuse, and how insurance products can be weaponised, the guide suggests.Alongside a customer guide, the ABI has also set out how firms can better support employees experiencing domestic abuse.Developed in partnership with EIDA, the guide to helping employees aims to help firms create supportive workplace environments and build cultures where staff experiencing abuse feel able to access help.The guide says employees dealing with abuse can feel like their workplace is the only safe place they have.But in some cases the abuse may lead to an impact on the employee’s performance at work – and they may ultimately lose their job if the employer is not aware that their employee is experiencing abuse.The victim-survivor may also have limited availability to attend work events, be late to work, leave early, or take unplanned time off due to the abuse. They may also be harassed online, on the phone or at their place of work by their abuser.The guides were being launched in Parliament on Wednesday.They are part of wider efforts to improve outcomes for vulnerable customers and support the Government’s Financial Inclusion Strategy.Surviving Economic Abuse estimates that around one in six women in the UK has experienced economic abuse by a current or former partner.Hannah Gurga, ABI director general, said: “Feeling safe and in control of your own life is something everyone should be able to expect.“Developed with specialist charities, these guides will help insurance and pension firms recognise the signs of economic and domestic abuse, respond with care and give customers and employees the support they need.”Lucy Rigby, Economic Secretary to the Treasury, said: “Economic abuse can devastate lives.“Abusers weaponise anything they can, including insurance, to maintain control over victims – trapping victims in policies they want to leave or cancelling the policies they depend on.”Susan Bright, chief executive of the Employers’ Initiative on Domestic Abuse, said: “We are very pleased to see the leadership role the ABI have taken to develop this guidance and make it available to the wider industry.“Employers are a crucial part of the whole-of-society response to domestic abuse, and through our work with EIDA’s over 2,000 employer members, we see the real difference that a domestic abuse-aware and supportive employers can make.”James Dipple-Johnstone, chief ombudsman of the Financial Ombudsman Service (FOS), said: “Economic abuse can have a devastating and lasting effect on people’s lives, and financial services firms have an important role to play in recognising these circumstances and responding with care, consistency, and fairness.“The cases brought to our service show that when firms fail to recognise economic abuse or respond with sensitivity, people can be left feeling isolated, unsupported, and less able to manage their finances safely.“We support this guidance because it gives firms practical steps to identify vulnerability earlier and provide support throughout all customer interactions.”Helen Bellamy customer inclusion lead at wealth manager Quilter said: “Economic and domestic abuse can have a devastating impact on a person’s financial wellbeing, often leaving lasting consequences long after the abuse has ended.“Providers have a responsibility to ensure customers facing these circumstances are treated with understanding, sensitivity and care.“The ABI’s new guidance is hugely useful as it provides practical support to help firms identify potential signs of abuse, enable safe disclosure and deliver better outcomes for those affected.”