Clients complain: Adviser should have told us to obtain notes

A client's complaint that their insurance adviser or insurance company should have told them to request their medical notes when they took out a policy has been dismissed by the Insurance and Financial Services Ombudsman.

Thursday, December 20th 2018, 3:00PM

The couple applied for a range of insurance products, including standalone medical cover, in 2011.

The woman made a claim in 2017.

During the assessment of the claim, the insurer obtained her medical notes.

It retrospectively added an exclusion to her medical cover, on the basis that she had failed to disclose her history of lower back pain.

The couple complained on the basis that the insurer should have requested their notes before the policy began.

Alternatively, they said, their adviser should have told them to get the notes.

The IFSO case manager said the onus was on the client to give the insurer their medical information.

Two other underwriters who were presented with the case said, had they been given the same information, they would have applied an exclusion to the policy.

The case manager said it was material and the insurer was entitled to rely on the non-disclosure clause to alter the terms of the policy

In relation to the adviser's obligation, the IFSO case manager said it was reasonable to expect the adviser to tell a person completing an application about their duty of disclosure, even if there was no statement about it included at the start of the application form.

But the case manager did not believe that there was any active obligation for a financial adviser to specifically advise an applicant for insurance to obtain a copy of medical notes, provided the applicant had been adequately warned about the disclosure obligations.

In this case, there was evidence that the couple had received a warning.

They also complained about a delay in adding their son to their medical policy.

They said they asked the adviser to do so in 2012 but it did not happen until 2013.

When they tried to claim for a tonsillectomy for him in 2015, they were turned down because it was a pre-existing condition.

They said, had the adviser added him when asked, that would not have happened.

IFSO said there was no evidence of that 2012 meeting and so the adviser could not be held responsible.

Tags: IFSO insurance