Two-time cancer survivor wins insurance claim battle

A cancer survivor has chalked up a victory against an insurer who refused to pay her out for dread disease after she was diagnosed with the illness for a second time.

Judge Ron McLaren‚ ombudsman for long-term insurance‚ ordered Alexander Forbes to pay the woman for her second claim‚ saying in the absence of an exclusion clause‚ “there is no legal or insurance principle which prevents an insured person from claiming under two different policies for recurrence of a condition”.

The woman was diagnosed with breast cancer in 2013. A claim was paid to her under a policy that was underwritten by another insurer.

She underwent a mastectomy in 2014 followed by radiation therapy. From May 2015 the woman was covered by her employer’s group risk policy for dread disease‚ underwritten by Alexander Forbes.

In October of the same year‚ she was diagnosed with liver metastases and stage four breast cancer‚ for which she submitted a claim to Alexander Forbes.

The insurer first relied on the pre-existing exclusion clause which stated: “No Dread Disease Benefit shall be payable under this policy during the first 12 months of a Life Assured’s Commencement Date if‚ in the opinion of the insurer‚ the Dread Disease claim is directly or indirectly attributable to any injury or illness in respect of which the Life Assured sought medical advice‚ or about which he knew or could reasonably be expected to have known‚ during the six-month period preceding the commencement of his becoming a Life Assured.”

The Ombudsman requested Alexander Forbes to provide the medical evidence on which it relied to invoke the pre-existing exclusion clause. None was provided.

Alexander Forbes‚ in its defence‚ said group risk insurance contracts were generally accepted on the same terms and conditions by the new insurer as the previous insurer‚ so as not to disadvantage the policyholder as a result of changing insurers.

“In agreeing to take over her benefit on the same terms and conditions as per previous cover effectively meant that Alexander Forbes would need to keep its decision consistent with the previous insurer‚” it stated.

Alexander Forbes also said it was not aware of her previous claim for the same disease.

Judge McLaren said the woman had been under the impression that she was in remission and that the Alexander Forbes policy was a new contract‚ not a continuation.

Alexander Forbes has paid the woman’s claim.