OLHI OLHI – OmbudService for Life & Health Insurance | Resolution of your Canadian Insurance Concerns | OLHI

Ms. V. was being treated for major depression and anxiety disorder. Her insurer accepted her disability claim on the basis that she was not able to perform the essential duties of her job as an office manager of a busy, professional firm.

Midway through that benefit period, the insurer discontinued her group benefits because Ms. V. opted to try to start her own business out of her home. The insurer’s final position was that the objective medical evidence on file suggested that her impairment was not sufficiently severe to prevent her from returning to her pre-disability job.

Ms. V. contacted OLHI for an independent, free review of her case. Our Dispute Resolution Officer (DRO) gauged that the diagnosis, symptoms and treatment hadn’t changed from the period during which Ms. V. received disability coverage. For this reason, he recommended the case be investigated by an OmbudService Officer (OSO).

OLHI’s OSO reviewed the file and questioned how, with the evidence on file, the insurer could conclude that Ms. V. was able to resume performing the skills of her prior demanding, managerial role.

The OSO contacted the insurer, asking them to consider that a job as an office manager of a busy firm could not be equated with a home business. He also suggested that the medical evidence was clear that Ms. V.’s condition had not changed between the last day of paid benefits and the first day of denied benefits.

Upon further discussion and review, the insurer agreed and provided Ms. V. with payment for the period that correlated with her inability to perform the essential duties of her job.

 

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.

Mr. J. was diagnosed with prostate cancer and submitted a claim against his Critical Illness policy. His insurer declined his benefit, stating that his particular type of prostate cancer was at a stage that is not covered under his policy.

Mr. J. contacted OLHI with his insurer’s final position letter, telling our Dispute Resolution Officer (DRO) that his stage one cancer was on a list of exclusions – a list he never received from the insurer, so he was completely unaware of this detail. While Mr. J. did receive a one-page document outlining his schedule of coverage, he did not receive the complete policy package, known as the fulfillment kit, which would have also included a cover letter and detailed policy.

Upon further review by the DRO, he discovered that the insurer’s records confirmed that the fulfillment kit status was “pending print in print queue.” Based on this, there was reasonable doubt that Mr. J. did not get the kit. He recommended that an OmbudService Officer (OSO) investigate.

OLHI’s OSO agreed that it was reasonable for Mr. J. to assume that he was covered, just based on the one-page document of information he had.

Because this one page included Mr. J.’s address and did not reference any other documents, there was logic in Mr. J. believing this page formed his complete policy. In Ontario, by law, an insurer must deliver a policy to the insured and the insured has the right to review and agree to it. The OSO suggested that because Mr. J. did not get his fulfillment kit, he was deprived of his right to examine and agree to the complete policy.

As a result, the OSO contacted Mr. J.’s insurer and recommended they reconsider their decision, given the technical problem and reasonable doubt. As a gesture of good faith, the insurer agreed to pay out the claim.

 

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.

Thirty years ago, Mrs. B. purchased life insurance. The premium would change over the years and the cash surrender value would be flexible but, as she understood it, she was guaranteed a paid-up $200,000 policy at age 65. This original policy was subsequently transferred to several insurers over the years.

When she turned 65, Mrs. B. received a letter informing her that her policy was now paid up; no more premiums were necessary to maintain the value of $200,000 and to keep her policy in force. Mrs. B. stopped making payments but, several years later, received a letter advising that her policy was now valued at $158,000.

Although no further premiums were required to keep the policy in force, the insurer stated that the sum insured continued to be reviewed for adjustment. Mrs. B. disagreed and contacted OLHI for a free, independent and impartial review of her file. She provided us with the final position letter and copies of all her correspondence with the various insurers that had owned the policy over the years. We also received the current insurer’s file.

OLHI’s first impression was that there would likely be no grounds to negotiate as the decrease in the sum insured was likely contractual.

However, OLHI’s Dispute Resolution Officer (DRO) discovered that Mrs. B. had a letter from the original insurer, guaranteeing in writing the sum insured of $200,000, with no adjustments to that sum. For this reason, the complaint was escalated to an OmbudService Officer (OSO) for further investigation.

Speaking with the insurer, the OSO concurred that the policy clearly outlines the recalculations of the premiums and the fact that the sum could change after age 65. However, he also noted that the guarantee letter could not be overlooked. The insurer, after additional review, agreed to honour the commitment that the previous insurer had made, confirming that the sum insured would not be recalculated in future.

 

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.

Mr. G. went on a medical leave from work for a year, due to a mood disorder that included depression. During this time, through his group insurance plan, his employer covered his disability benefits. But after a year, the insurer terminated benefits upon receiving information from Mr. G.’s doctor that he was planning on returning to work. He did not, though, as his psychiatrist stated that he was unable to. The insurer completed a medical investigation and, in its final position letter, wrote that Mr. G. was not completely disabled and could return to work.

Mr. G. contacted a Dispute Resolution Officer (DRO) at OLHI. The DRO discovered that while Mr. G.’s doctor had recommended he return to work, his psychiatrist did not support the finding and felt that Mr. G. was still suffering from a severe disorder. For this reason, the DRO recommended the complaint be escalated to an OmbudService Officer (OSO) for investigation.

As a part of his review, the OSO spoke with the consumer as well as the insurer and went through all the documents that both parties shared with him. The medical reports revealed that even after his disability payments stopped, his psychiatrist continued to treat Mr. G. for his illness. The OSO also discovered a crucial detail: that the insurer’s decision to stop disability payments was based on a conversation with Mr. G.’s psychiatrist, where he said Mr. G. had quit his job. However, the transcript of this telephone conversation did not match formal reports. Mr. G. explained to the OSO that his psychiatrist may have confused the fact that he quit another job many years earlier.

The OSO reached out to the insurer, requesting they confirm with the employer whether Mr. G. had in fact quit or was still employed and on leave. The employer was able to confirm that he had not quit his job. After some further discussion, the insurer agreed to reconsider and made a settlement offer. Mr. G. was thrilled to reach a settlement – and was also very appreciative of the way the OSO was able to explain his case in plain language to him so that he could better understand how the insurer reached their initial decision.

 

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.

Mr. F. applied for Critical Illness insurance through and submitted his application with the help of his insurance advisor. The insurer rescinded coverage, saying that he had misrepresented his medical history on his application.

Mr. F. contacted OLHI after receiving the insurer’s final position letter. He told the Dispute Resolution Officer (DRO) that although he understood his insurance policy could not be reinstated because of his medical history, what he wanted from the insurer was a written apology for alleging that he had misrepresented himself. Mr. F. was concerned that this allegation could impact his ability to purchase insurance products in future.

The DRO recommended the complaint be escalated to an OmbudService Officer (OSO) for further investigation. The OSO learned from Mr. F. that, when he applied for insurance, he had told his advisor about some upcoming medical tests scheduled for a later date – but the advisor told him not to worry about it because these were post-application. Mr. F. also noted to the OSO that his advisor had put the wrong date on the application and had not asked Mr. F. one of the questions. Instead, the “no” box was selected – something Mr. F. asserts he would have never said “no” to. He explained that, when he was reviewing a copy of the application submission that was sent to him, he noticed the error and reached out to his advisor immediately to revise it.

Mr. F., however, did not hear back from his advisor. Instead, he received a letter from the insurer, rescinding his insurance coverage because some medical information had not been disclosed.

In its final position letter, the insurer outlined that it’s the applicant’s duty to review all the questions and answers on an application, for accuracy, before signing. A signature indicates that the review was completed and the information provided is accurate. The insurer stated that Mr. F.’s upcoming medical tests should have been noted on the application and also advised that the reason for the underwriting decision would remain confidential within the insurer’s files – and that they would review their application process with the advisor.

After conversations with the consumer and the insurer, the OSO determined that without documentation to corroborate Mr. F.’s position that the advisor had incorrectly filled in the questionnaire, OLHI could not pursue an exoneration or apology. A signed application, as a legal document, implies that the applicant has reviewed and agreed with all the contents. Whether intentional or an innocent mistake, the misrepresentation occurred.

The OSO did however reiterate to Mr. F. that while his future efforts to obtain insurance would reveal his medical history, the reason for a rescission would not be revealed – but that Mr. F. will have to share this detail nonetheless in the interest of full disclosure.

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.

Mrs. Q. began to see an acupuncturist, paying in advance for a package deal that would reduce the price of each individual treatment. In order to receive reimbursement through her group health plan, she had to have a prescription from her family doctor and had to select an acupuncturist certified by a governing board. Mrs. Q. had the prescription but her province did not have a governing board for these practitioners. She selected a certified acupuncturist but, when she submitted her claim, the insurer denied it based on the fact that his credentials were not recognized by them.

As a goodwill gesture, the insurer agreed to cover the costs of the sessions Mrs. Q. went to up to the date of their denial (approximately half of the sessions she’d bought) but would not absorb any costs going forward. She appealed the decision, stating that she had paid for the sessions up front and could not cancel the rest. She also claimed that there was no way for her to know whether or not her acupuncturist’s credentials were recognized by the insurer.

Mrs. Q. contacted OLHI and our Dispute Resolution Officer (DRO) learned that Mrs. Q. had not yet received a final position letter from her insurer. He recommended that she contact the insurer’s Ombudsman and request a final position letter, at which point OLHI could become involved. A couple of weeks following this conversation, Mrs. Q. received this letter and called back the DRO.

The DRO learned that Mrs. Q.’s coverage booklet from her employer did not outline that services would only be covered if the acupuncturist was recognized by certain associations, of which this particular acupuncturist was not a part of. Mrs. Q. could not cancel her future sessions, having paid up front. She asserted that the full package should be covered by the insurer.

With this information, the DRO recommended the case be escalated to the OmbudService Officer (OSO) level to see if there was any room for negotiation with the insurer and to further investigate the reasoning behind their claim denial.

OLHI’s OSO reached out to the insurer’s Ombudsman’s office to further discuss the case, indicating that he felt Mrs. Q. had some valid arguments, based on preliminary findings. It was over the course of the OSO’s exchanges of information that he discovered Mrs. Q.’s employer had received a notice from the insurer the year prior – long before Mrs. Q. arranged for acupuncture treatments. This notice outlined the insurer’s criteria for acceptance of an acupuncturist and a list of recognized associations. Additionally, the notice recommended that employees should submit an estimate to the insurer before going to any expense, so the insurer could review that specific acupuncturist’s credentials.

The insurer acknowledged that it’s possible Mrs. Q. did not see this notice, for any host of reasons – but that it’s the responsibility of employers to ensure such information is properly passed on to employees.

The OSO agreed that the insurer’s decision be maintained, believing it was fair that half the claim had been paid despite the fact that others were responsible for the unfortunate turn of events.

 

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.

When Ms. W. went on long-term disability after suffering degenerative disease in her knees, both her individual disability benefit plan provider and the Canada Pension Plan accepted her disability and began paying out her claim. However, when she submitted her claim to her group plan provider, through her employer, she was declined, much to her surprise and confusion.

The insurer explained that definitions of disability differ between insurers and between policies; as a result, an insurer could not base a decision on that of another. Ms. W.’s insurer stated, in its final position letter, that although medical notes indicated inability to deep knee bend, kneel or run, they did not mention any difficulty with sitting or complete intolerance to any driving, walking or standing. For this reason, the insurer noted that their claim denial decision was made based on the level of information provided.

When Ms. W. contacted OLHI, a Dispute Resolution Officer (DRO) learned from Ms. W. that she did in fact have trouble sitting for long periods of time and as such could not work full time – and any part time income would not equal what she was earning either in a job or through disability payments. Jobs in her field required a lot of manual labor, which she could no longer perform.

The DRO also discovered, when going through Ms. W.’s file, the insurer’s medical consultant had suggested that more tests be undertaken – none of which were run or requested by the insurer. Additionally, all medical notes from Ms. W.’s doctors noted that her condition would likely worsen over time, making it increasingly difficult to perform physical tasks.

Based on this information, the DRO recommended the case be escalated to an OmbudService Officer (OSO). The OSO’s investigation revealed reports from the family doctor, written after the claim period in question. The doctor wrote that Ms. W. could not spend time in any particular position (sitting/standing) for more than a few minutes at a time, making it impossible for her to drive to a job and work. The insurer had also noted in its file that, given her relatively young age, she be assessed to determine whether any jobs would be best suited for her. The insurer suggested Ms. W. could be capable of certain jobs in her industry that are sedentary with the ability to change her body’s position frequently, from sitting to standing. This belief was further confirmed by a medical note in Ms. W.’s file, written by her doctor, where he suggested she be trained to perform a sedentary job.

Resulting from our OSO’s extensive research into the case, where he spoke with the consumer, her doctors and the insurer, he concluded that the medical records available for the specific time period at hand did not support complete inability to perform work. The OSO advised that it was his recommendation that the insurer’s decision be upheld.

 

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.

 

Mr. S. decided to take advantage of the lower premium rates and purchase travel health insurance several months ahead of a trip to the U.S. While in the U.S., he went to a clinic and was diagnosed with bronchitis and then went back to the clinic because of side-effects from the medications prescribed for the bronchitis.

Mr. S.’s insurer rejected his claim because his application did not disclose his gastro-intestinal problems and because he did not notify the insurer of treatment he had received since buying the insurance. After getting his travel insurance coverage, but before going on the trip, Mr. S. had a colonoscopy and removal of a polyp. The insurer denied the claim and subsequent appeals due to material non-disclosure.

After Mr. S. received the insurer’s final position letter, he called OLHI and submitted his complaint for our review.

A Dispute Resolution Officer (DRO) found that call recordings at the time of purchase supported that Mr. S. had disclosed his medical information, including past findings of diverticulitis. As explained by Mr. S., he had not checked the box on the policy application asking if he had been treated or taken medication for any gastro-intestinal condition, as he was not taking any medication for diverticulitis. Neither he nor his doctor felt that regular colonoscopies should be deemed “treatment.”

The policy said that the duty to disclose pre-existing conditions at the time of the application was based on the definition of “treatment,” whereas after policy issue, the eligibility for coverage was based on a change in health condition or medication.

OLHI advised the insurer that Mr. S.’s complaint had merit and would therefore be escalated to our investigation level. Before this investigation was started, the insurer advised that, upon further consideration, they would fully reimburse Mr. S. for his expenses.

 

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.

Mr. O.’s travel insurance application declared that he was suffering from chronic lower back pain from a fall in 2008. His insurance application was approved, with the pre-existing condition noted. While on holiday, he suffered acute hip pain and, as advised by the insurer, was taken by ambulance to a hospital where he was tested, treated with pain killers and released.

The insurer denied Mr. O.’s claim on the grounds of his pre-existing condition and that he had not reported a steroid injection treatment he received days before his vacation.

Mr. O. appealed the denial, following the insurer’s complaint process. The insurer upheld its’ decision so Mr. O. submitted his complaint to OLHI for review.

Through a review of both the consumer’s and insurer’s documents, the Dispute Resolution Officer (DRO) narrowed the issue down to the insurer’s position that the hip pain was directly related to the steroid injection before his trip. Although the DRO agreed that Mr. O. should have reported the treatment before his trip, she also agreed with his doctor’s view that, given the time between the treatment and the hip pain, there was no direct cause and effect. She suggested that the complaint be escalated to an OmbudService Officer (OSO) for further investigation.

The OSO reviewed the file and also spoke with the consumer. He raised two issues: 1.) Was the hip pain that triggered the hospitalization a pre-existing condition, as defined by the policy; and    2.) Did the injection just before travelling directly contribute to the hip pain? The OSO found that, although Mr. O.’s doctor challenged that the injection caused the hip pain, clinical notes from both the doctor and the hospital’s attending physician supported the insurer’s position that the hip pain was most likely due to the consumer’s chronic lower back pain.

The OSO felt it was unlikely that he could argue that the hip pain was not part of the defined pre-existing condition. He also determined that Mr. O.’s failure to notify the insurer of the injection had deprived the insurer of the opportunity to determine if the injection was a material change to the assumed risk – thereby potentially permitting the insurer to decline coverage.

The insurer’s claim denial was maintained.

 

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.

Mr. Y. had been receiving long term disability (LTD) benefits from his insurer for two years. He applied for and was accepted by Canada Pension Plan (CPP) for disability benefits. Since Mr. Y. had received retroactive amounts from CPP, the insurer followed up with a request for the overpayments they had made to him.

At question was whether the calculations were accurate. Mr. Y. disputed the insurer’s calculations and, after receiving a final position letter, called OLHI for help.

OLHI’s Dispute Resolution Officer (DRO) reviewed the consumer’s documents and the insurer’s file. She read the policy contract section on coordination of benefits, which refers to a combination of benefits coverage from more than one extended health plan. The DRO also reviewed how the insurer applied the indexations, which are adjustments to income payments to protect against inflation. She agreed with the consumer’s claim that the insurer may have erred in applying the indexations. She recommended that the complaint be escalated to an OmbudService Officer (OSO) for further investigation.

The OSO confirmed with Mr. Y. that he was receiving his LTD and CPP benefits, and that he had repaid to the insurer the overpayment requested. The issue remaining was if and how indexation should be applied in the re-calculation of his LTD benefits.

The OSO wrote to the insurer, suggesting that their business unit had focused on the correctness of the calculation but not on the correctness of the overall formula. The OSO also suggested that it might be helpful if the interpretation of the policy contract could be reviewed by the insurer’s legal department.

The insurer’s counsel reviewed both the OSO’s recommendation and the policy contract wording. Although they identified additional areas in the contract that would affect the calculation of the benefit in their favour, they agreed that the section on coordination of benefits supported Mr. Y.’s position. In good faith, the insurer proposed a compromise, which was accepted by the consumer.

 

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.