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Ms. C. had been suffering from chronic migraines and headaches for years, exacerbated by depression and anxiety. She was being actively treated for her conditions. When her loss of concentration began to negatively impact her work product, coupled with her inability to physically sit in front of a computer, she went on short term disability (STD). The insurer denied her claim, citing insufficient clinical medical evidence to support an ongoing condition. The insurer felt that Ms. C. was well enough to work and, upon her appeal, upheld its decision to deny STD.

Ms. C. approached OLHI for an independent, impartial review. The Dispute Resolution Officer (DRO) went through Ms. C.’s records, medical notes from various doctors and specialists, as well as the insurer’s file. He also read a letter from her employer, who verified that Ms. C.’s inability to work and cope with her migraines had negatively impacted the business – and precluded her from performing her regular duties.

The DRO recommended that an OmbudService Officer (OSO) investigate Ms. C.’s case. Upon further review, the OSO focused on a statement the insurer made in its final decision, classifying Ms. C.’s migraines, headaches and depression as “symptoms” lacking a specific medical condition. Ms. C. and her doctors stressed to the insurer and to the OSO that her diagnostic tests (x-rays, CT scans, blood work) were normal/negative to rule out symptoms of a secondary illness, such as tumours – not to rule out her condition.

The OSO agreed that migraines and depression are an illness and not symptoms of another unknown, unsupported condition. Her doctor provided examples from various credible sources, including the World Health Organization, confirming that migraines and depression are illnesses.

OLHI recommended that the insurer reconsider their position and pay Ms. C.’s STD claim.

The insurer, upon further reflection, agreed and provided payment of Ms. C.’s STD benefits.

 

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. Z. purchased out-of-Canada emergency medical expense insurance in connection with a trip to the U.S. While there, he needed medical treatment for a kidney stone and, afterward, submitted a claim to the insurer for the expenses he incurred.

The claim was denied because his U.S. hospital records noted that he had experienced flank/back pain a week before his departure and he had not disclosed this to his insurer before traveling.

The exclusions section of his policy denied coverage for any sickness, injury or medical condition, occurring before the date he left on his trip, which was expected to lead to treatment or hospitalization. In sum, the insurer believed that Mr. Z. had a “pre-existing medical condition” that he was required to tell them about before traveling. All travel insurance contracts contain a clause of this nature; however, the exact disclosure requirements vary from contract to contract.

Mr. Z. appealed the denial and followed the insurer’s complaint process, where the decision was upheld by the insurer. He then submitted his complaint to OLHI for review.

With both the details provided by the consumer and the insurer’s file in hand, OLHI’s Dispute Resolution Officer (“DRO”) reviewed the case and concluded that the denial was entirely based on statements contained in the U.S. hospital records regarding prior back/flank pain. The DRO found that there had been no contact initiated by the insurer with either the U.S. hospital or the consumer. He also observed that the U.S. hospital notes stated that the consumer had experienced pain one week prior, that went away, and, in direct contradiction, that Mr. Z. had experienced “unremitting flank/back pain” for the entire week prior to his departure.

Although the insurer’s Ombudsman had suggested that the claim be paid, the business unit declined the claim.

OLHI’s DRO expressed doubt about the accuracy of the U.S. hospital records and suggested that this could be the basis for OLHI to approach the insurer. It was recommended that the complaint be escalated to an OLHI OmbudService Officer (“OSO”) for further investigation.

The OSO spoke with the consumer directly and learned that he had made no mention whatsoever of any “flank pain” but that the back pain he had experienced one week prior to departure went away on its own with over-the-counter pain relief and a warm bath. Our OSO also reviewed the documents provided by the insurer, including the insurer’s claims review process documents. His findings echoed those of the insurer’s Ombudsman.

In his submission to the insurer, the OSO highlighted the incongruities in the U.S. hospital records. He suggested that the policy exclusion could not be fairly invoked given the fact that Mr. Z.’s prior back pain had gone away with a warm bath and an over-the-counter pain reliever. He also suggested that it was improbable that anyone with constant, severe pain leading up to this trip could travel anywhere and hence the unreliability of the U.S. hospital admission record. The OSO recommended that the insurer reconsider its’ decision.

The insurer thanked the OSO for his comprehensive review and supported OLHI’s recommendation to pay this claim. The consumer‘s claim was paid shortly thereafter.

 

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. M. had a $25,000 term life insurance policy. As the premium rates were about to increase dramatically and affordability was an issue, his insurance agent, who had originally sold him the policy, offered to research more affordable options.

This search proved a challenge. Mr. M. had health issues and, given the risks, few insurers would offer alternative coverage on a single life basis – at least, none that the consumer found affordable. At the end of the exercise, the agent proposed a joint last-to-die policy and wrote up an application for Mr. M. and his common-law partner, Ms. L.

The new policy was delivered and Mr. M. cancelled the previous one. He paid the premiums for just over two years before passing away. Ms. L. made a claim in order to pay final expenses and was surprised to have the claim denied because it was a joint-last-to-die policy. In such a policy, no proceeds are paid out until the death of the second spouse.

Ms. L. followed the insurer’s complaint process, where the insurer upheld its decision to deny the claim. She then brought her complaint to OLHI.

The Dispute Resolution Officer (“DRO”) reviewed the consumers’ documents and found anomalies in the application. The consumers’ statements in the application clearly indicated their intent to use the coverage for final expenses upon Mr. M.’s death and they designated Ms. L. and their daughter as beneficiaries – requirements that could not be met under a joint-last-to-die policy. The DRO recommended that the complaint be escalated to an OmbudService Officer (“OSO”) for further investigation.

The OSO reviewed both the file documents and the analysis from the DRO, and concurred that there were discrepancies in the sales process. He noted a lengthy delay in issuing of the policy and that there was no copy of a Life Insurance Replacement Disclosure form in the file. This disclosure form is required to be provided whenever a consumer replaces one life insurance policy with another. It provides a side-by-side comparison between the old and the new policies and serves to demonstrate that consumers understand the differences between the two policies.

Since recollections from the consumers and the agent differed, this missing form proved to be the crux of the issue.

In his detailed submission to the insurer, the OSO suggested that the lack of a properly completed replacement declaration form deprived Ms. L. and Mr. M. of the full and plain disclosure they were entitled to, and that their decision to purchase the new policy and cancel the previous one was not a fully informed one.

The OSO recommended that the insurer compensate the consumer for the loss of the $25,000 coverage provided by the original policy.

The insurer agreed to do so and the proposed payment was issued to 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.

Mr. F., diagnosed with cancer, made a claim on a Critical Illness insurance policy. If his claim was accepted, the insurance would have paid off a $10,000 loan he had taken out with his bank. His claim was denied on the basis that he did not have Critical Illness insurance coverage on the loan.

Mr. F. received his insurer’s final position letter and contacted an OLHI Dispute resolution Officer (“DRO”), seeking an independent review of his complaint.

During several conversations and exchanges of emails, our DRO learned that Mr. F., who had a prior line of credit that covered him for Critical Illness, converted this into a new loan a short time before making the claim. The bank denied his claim because this new loan was not insured for Critical Illness and he was diagnosed with cancer after the new loan was made.

Mr. F. claimed that he was diagnosed in early April and that the new loan was not taken out until later that month. Therefore, the coverage from the previous line of credit should be applied to pay out his claim. Meanwhile, the insurer stated that its denial was based on medical reports indicating that the cancer was not diagnosed until June, long after the line had been closed and replaced with a loan that did not provide Critical Illness coverage.

During his review, the DRO assessed that there were conflicting dates in the medical reports relating to the diagnosis date. He also questioned why Mr. F. would have taken out a new loan when he was ill, since that would result in him becoming ineligible for Critical Illness coverage under the new loan. As a result of this, the DRO recommended that the complaint be escalated for further investigation by an OLHI OmbudService Officer (“OSO”).

The OSO poured over medical records, as well as the insurer’s file and the consumer’s documents, and had several conversations with all parties. The focus of his review was to determine whether a diagnosis had been made before the cancellation of the Critical Illness insurance coverage on the prior line of credit. Medical records showed that the confirmed date of diagnosis was in fact in June, two months after the old line of credit was closed and the new loan opened.

While written communications in early April between Mr. F.’s doctors showed mention of cancer, it was referred to as a suspected illness requiring further investigation and formal confirmation. Because insurers pay Critical Illness benefits based on clear diagnoses, not suspected conditions, his insurer would not have paid out the claim in April.

The OSO, through his investigation, also learned why Mr. F. took on a loan that wouldn’t provide critical illness coverage at a time when he needed this coverage most: Mr. F. admitted that, when speaking with the bank to set up the new loan, he did not advise that he might have cancer.

Because the bank did not have this information, they could not advise him to keep his current lines of credit, which provided Critical Illness, rather than taking on a loan that did not provide this coverage.

As a result, the OSO recommended to Mr. F. and the insurer that the original claim denial should 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. contacted OLHI seeking help with the approval of his disability benefits. The OLHI Dispute Resolution Officer (DRO) who took his call learned that he had purchased a vehicle some years before and financed the purchase with a loan. At that time, he signed up for group creditor insurance that would pay his monthly car loan payments in the event he became totally disabled. Thereafter, Mr. S. was diagnosed with a terminal condition. He applied for the disability benefits but his claim was denied on the basis that it was out of time.

Our DRO was able to determine during the call that Mr. S. had not received the insurer’s final position letter. He advised Mr. S. that he would need to complete his insurer’s internal complaints process before OLHI could review the complaint. Mr. S. was provided with the contact information for the insurer’s Ombudsman.

About a month later, Mr. S. called back upon receipt of his insurer’s final position letter. The DRO explained that OLHI would open a complaint file once Mr. S. signed and submitted OLHI’s Authorization Form and other relevant documents. Thereafter, OLHI would request documents from the insurer and both he and the insurer would be notified in writing that the complaint was under OLHI’s review.

Upon receipt of the documents from both parties, it appeared to our DRO that Mr. S. might have a reasonable case. She recommended that the complaint be transferred to an OmbudService Officer (OSO) for further investigation.

The OSO reviewed the sequence of events. Mr. S. last worked in October, 2010. In 2009, he had bought a new car and, through the dealership, purchased creditor life and disability insurance with a single premium that was spread over his monthly car payments. Following his disability diagnosis in the fall of 2010, he applied and was approved for CPP disability in June 2011. Mr. S. was under the mistaken impression that he had to apply for the CPP disability benefit before applying for any other benefits. His anxiety over his disability diagnosis and the consequent need for him to focus on daily living activities had caused him to lose track of the fact that he had creditor disability coverage.

Mr. S. filed his claim in August 2011. The insurance policy required him to provide his insurer with notice of the events giving rise to the disability within 30 days and to provide medical evidence establishing his claim within 90 days of onset of disability. As a result, the insurer’s final position letter denied his claim on the basis that it was filed too late.

The OSO spoke to Mr. S. and explained the reasons why the insurer was within its rights to rely on the time limitations set out in the policy. However, he suggested that it might be possible to obtain a settlement whereby the loan payments would be covered from the date the insurer was provided with notice of the claim. Mr. S. readily agreed that this would be an acceptable resolution of his complaint.

The OSO subsequently made a detailed written submission to the insurer, suggesting it pay the benefits from August 2011 onwards. The basis for this suggestion was that the disability was clearly established and the insurer was not prejudiced if the claim was admitted on a “go forward” basis.

The insurer responded in short order, agreeing to allow the claim from the date it received notice. This resulted in Mr. S. receiving a reimbursement for the payments made by him while he disputed the claim with his insurer and during OLHI’s complaint process. The insurer also paid the loan instalment payments from that point forward.

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. A. called OLHI seeking assistance with her group health benefits. Her insurer had denied payment for treatments recommended for her son’s cerebral palsy and issued her a letter referring her to OLHI if she wished to further pursue her complaint. All Canadian life and health insurers who are members of OLHI issue such a letter, known as a “final position letter,” once their internal company complaint process is completed.

Based on their conversation, the Dispute Resolution Officer (DRO) concluded that OLHI could proceed with an independent review of Mrs. A.’s complaint once she had signed and submitted OLHI’s Authorization form. A letter was then sent to Mrs. A. confirming that the complaint had been opened and she could expect to hear from OLHI within 60 to 90 days. Copies of all documents relevant to the complaint were requested from both Mrs. A. and her insurer, including her employee benefits brochure and all relevant correspondence.

The documents submitted by both parties were reviewed by the DRO. He noted that the definition of “eligible expense” in the insurance policy and in the benefits brochure contained several conditions. Nevertheless, he was not convinced that the terms of the insurer’s policy clearly explained why and how the claim was not eligible. He noted that conflicting messages may have been given by the insurer. Accordingly, he recommended that the complaint be escalated to an OLHI OmbudService Officer (OSO) for further review.

Upon receipt of the complaint file, the OSO reviewed the proceedings to date, including the documents from both parties. He then spoke at length with Mrs. A., who had been left confused by the insurer’s communications.

He learned that initially, Mrs. A. was told the treatments would be covered. She was then advised, in writing, that the proposed treatments were not eligible because they were not considered “reasonable,” although the insurer offered to reconsider its’ position if she could demonstrate that the treatments were medically supported. Based on this information, Mrs. A. obtained a letter from her son’s doctor justifying the treatments but the insurer denied the claim once again.

In the meantime, a representative of the insurer had mentioned to Mrs. A. that treatments of this nature had been previously allowed on an individual basis.

The OSO contacted the insurer to gain a better understanding of its’ position. In particular, he wanted to understand why Mrs. A.’s claim had been turned down after she had submitted medical evidence that, on its face, seemed to prove that the treatments were medically reasonable. He was told that the proposed treatments were not eligible for payment because the relevant section of the policy was intended only to cover the cost of medical equipment, not the treatments themselves.

A further review of the insurer’s claim file by the OSO disclosed that the position that only medical equipment was covered had surfaced after the insurer had advised Mrs. A. in writing that “medically reasonable” treatments would be paid.

The OSO then made a detailed submission to the insurer. He recommended that, in light of the lack of clarity in the policy wording and the insurer’s conflicting and confusing messages to the consumer, it might consider allowing the claim without recourse to the experience-rating of the policy.

The insurer agreed to do so, and the course of treatments was allowed.

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. M. called OLHI after he received a letter from his wife’s insurer turning down her travel insurance claim. He and his wife had purchased out- of- country emergency medical and hospital insurance to cover them for an upcoming trip to the U.S. The insurance was bought over the phone and medical questions answered orally by both Mr. M. and his wife.

Unfortunately, Mrs. M was admitted to hospital and underwent emergency heart surgery while on vacation. When she returned home, she submitted a claim to the insurer for her U.S. medical and hospital expenses. These expenses were significant as Mrs. M. had spent over two weeks in hospital. The insurer denied payment for the claim on the basis that Mrs. M. had failed to fully disclose her medical history. Mr. M. contended that his wife had disclosed all necessary medical issues.

Since the insurer had issued its final position letter, our Dispute Resolution Officer (DRO) advised Mr. M. that OLHI could open a complaint file to determine if there were grounds to review the insurer’s decision. To start the process, Mrs. M. was asked to sign and submit OLHI’s standard Authorization form and all relevant documents, including a copy of the insurer’s final position letter.

During the initial call to OLHI, Mr. M. asked if his wife’s claim was subject to a “limitation period” – that is whether there was a time limit to start a legal action against the insurer to recover his wife’s expenses. He was told that the running of the limitation period was suspended while his complaint was under review by OLHI. He was advised to consult a lawyer if he had any concerns about what limitation period applied to his wife’s claim since OLHI could not provide legal advice.

In accordance with industry standard practice, once Mrs. M. filed a claim, her insurer obtained copies of her medical records. These records were provided to the insurer pursuant to a written consent signed by Mrs. M. at the time she filed her claim. The insurer forwarded copies of these medical records to OLHI once Mrs. M.’s complaint file was opened.

Upon reviewing Mrs. M.’s medical records, our DRO learned that Mrs. M. had seen her family doctor on three occasions just before she bought her travel insurance. These visits were made to address complaints of chest pain. A follow up test booked by her physician to investigate the symptoms was cancelled by Mrs. M. until she returned from her vacation. However, when she bought her travel insurance, Mrs. M. had told the insurer that she had not seen a doctor for “any reason that was not routine within the last 12 months”. In sum, the insurer had turned down Mrs. M.’s claim for reimbursement of expenses because she was under investigation for a pre-existing medical condition within that period.

Mrs. M.’s position was that the three visits she made to her doctor were in connection with a “minor ailment”, which was permitted under the policy. She argued that she had no “pre-existing medical condition” nor were her visits to the doctor made in connection with such a condition. The policy defined “minor ailment” as one that did not require more than one follow-up visit with her physician.

OLHI’s DRO concluded that Mrs. M. did not have a minor aliment because her condition required two follow up visits. As a result, the “pre-existing conditions” clause of the policy applied. This meant that she was required to disclose her full medical history to her insurer, including any and all consultations with doctors for “non routine reasons” within 12 months.

In the final analysis, Mrs. M. did not disclose her full medical/health history when applying for travel insurance and the insurer had legitimately turned down her claim for payment. Mrs. M. was advised that there were no grounds for OLHI to review her complaint with the insurer and her OLHI complaint was closed.

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. and Mrs. D. each purchased a segregated fund investment for a 10 year term. The principal amounts invested were 100% guaranteed if held to maturity.

The investments were placed in Registered Retirement Savings Plans (RRSPs) and therefore governed by the terms of the federal Income Tax Act (“the Act”) pertaining to those investments. The Act requires that an annual minimum withdrawal be made from the RRSP from the date the consumer attains 71 years of age. This annual minimum payment is known as a “RIF Payment.”

The consumers retained their investments until maturity. Several months later, they contacted OLHI alleging they had not received the full guaranteed amounts because their insurer had taken their annual RIF payments immediately prior to maturity, contrary to their instructions. The complaints were escalated to an OLHI OmbudService Officer (OSO) to obtain further information. He obtained copies of the relevant contracts from the insurer and undertook research into the RRSP provisions of the Act. He also spoke to both the insurer and the consumers.

The insurer acknowledged that there had been a reduction in the guaranteed amounts paid to the consumers. However, it believed the Act required it to take the annual RIF payment prior to maturity. It also relied on provisions in its contract which stated that any withdrawals prior to maturity resulted in a proportional reduction of the guarantee based on the current market value.

When our Officer spoke with the consumers, he learned that they had instructed the insurer to transfer the entire guaranteed amounts at maturity to another financial institution and to pay their annual RIF payments after maturity. These instructions, if followed, would have resulted in the consumers retaining an additional $5,000. The insurer did not reply to these instructions. The couple found out that the RIF payments had been taken prior to maturity only when they received their final investment statements. This prompted an immediate complaint to the insurer.

Thereafter, our OSO attempted to reach a settlement between the parties. He pointed out that the Act does not require withdrawal of the annual RIF payment prior to maturity of the investments. The insurer, however, contended that its contract required it to do so. OLHI believed that the insurer’s contract was unclear on this key issue. A settlement was not reached and the complaints were transferred to OLHI’s Senior Adjudicative Officer.

In accordance with OLHI’s complaints procedures, our Adjudicator reviewed all documents and interviewed the parties. She then delivered a written report containing findings and non-binding recommendations.

She concluded that Mr. and Mrs. D. purchased the segregated funds because they were guaranteed investments. They also knew it was not in their interest to take out any money before the maturity date and no withdrawals were made, except the minimum annual RIF payments from age 71 onwards.

The Adjudicator found that it was not appropriate for the insurer to take Mrs. D.’s annual RIF payment before maturity. By contract, Mrs. D. had elected this annual payment to be made 9 months later and, in all prior years, the insurer had made the RIF payments during the agreed month. She concluded that Mrs. D. was entitled to the full guarantee amount and recommended that the insurer pay the shortfall.

However, in the case of Mr. D., the chosen date for his annual RIF payment was two months before the maturity date of his investment. The insurer had not taken this annual withdrawal by the date the investment matured. It was therefore appropriate for it to take the annual RIF payment at maturity, and to reduce the guaranteed amount proportionally as per the contract, as this adjustment in the guaranteed amount should have occurred two months earlier. Accordingly, no compensation was recommended.

The insurer promptly agreed to comply with the Adjudicator’s non-binding recommendations and paid Mrs. D. the shortfall amount. Although he was disappointed not to receive any compensation, Mr. D. also accepted the recommendations of the Adjudicator.

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. T. contacted OLHI to seek assistance with reinstatement of his retirement group life insurance benefit. The Dispute Resolution Officer who took the call learned that this benefit had been allowed some years ago as part of an early retirement package negotiated with his employer. The employer was a life and health insurer, and OLHI Member Company.

OLHI learned that all had proceeded smoothly for several years until Mr. T.’s former employer sent him a letter which he did not receive because it was mailed to an out-dated postal address. This letter contained a notice advising the consumer that a medical certification of total disability was required to maintain his life insurance benefit. That letter was followed by another from his former employer, a month later, advising that his life insurance benefit had been cancelled for lack of the required medical certificate. This second letter was sent to Mr. T.’s current address.

OLHI was told that Mr. T. had immediately called his former employer to address the situation, at which point he learned that the letters had been sent to different addresses because separate databases had been used to locate his contact information. As it turns out, the database used to send the first notification letter had not been appropriately updated. Upon learning of this administrative glitch, Mr. T. sought written confirmation that his life insurance benefit would continue as part of his retirement package. Much to his dismay, several months later, the company confirmed that it would not continue the benefit on the basis that there was no commitment to do so.

Fortunately, Mr. T.’s former employer elected to treat the situation as an insurance matter, rather than an employment issue. As a result, it provided Mr. T. with a “final position letter,” inviting him to contact OLHI if he was dissatisfied. As is customary, the insurer’s final position letter provided OLHI’s contact details and a brief explanation of OLHI’s independent role in assisting life and health insurers and consumers to resolve their differences.

Following the conversation with Mr. T. and a review of the insurer’s final position letter, it was decided that the facts of the case warranted further investigation by an OLHI OmbudService Officer (OSO). The OSO reviewed the information collected to date and then spoke at length with the consumer. He ascertained that the agreement to provide Mr. T. with early group retirement benefits had indeed been made some years ago and that it was an oral commitment made with his employment superiors of the day. The consumer was very concerned because he now believed himself to be uninsurable and because some of the subscribers to the original agreement were no longer with the company.

Subsequently, the OSO prepared a written submission to the consumer’s employer, setting out the facts and issues as he understood them. He suggested that, although there was no written confirmation on the part of the company to provide Mr. T. with retirement group benefits, the fact that coverage had been provided for many years was evidence of that commitment. It was suggested that the commitment could not be voided by a notification error for which the consumer was not responsible.

In due course, the consumer’s employer replied, advising that it had reconsidered its original position and had arranged with the employer’s group benefits insurer to reinstate the consumer’s group life insurance benefit. As before, the life insurance benefit was subject to ongoing medical certification of total disability.

The employer thanked OLHI for bringing the issue of conflicting address databases to its attention and confirmed that it had undertaken an internal review of its employee address records. This review resulted in the company changing its policy on record keeping practices for employee addresses so that problems of this nature would not occur in the future with Mr. T. and other current or former employees.

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. called OLHI in early 2012. The Dispute Resolution Officer (DRO) who took the call learned that he was currently 61 years of age and had worked as horticulturist all his life until four years earlier, when he hurt his back. He was unable to work since the injury and had been declared “totally disabled” by the Régie des Rentes du Québec (“RRQ”). To obtain benefits from the RRQ, Mr. S. was required to demonstrate that he had a “severe and permanent disability.”

The consumer owed $20,000 in principle under his mortgage. Following his injury, his insurer covered his monthly mortgages under the credit insurance he purchased when he took out his mortgage. This insurance provided that, in the event of disability, the insurer would pay 150% of all mortgage related expenses. This meant that in addition to covering 100% of the monthly mortgage payments, Mr. S. received an additional 50% for other mortage related costs such as home insurance, realty taxes, etc. Monthly premiums on Mr. S.’s credit insurance were also waived. After 12 months, however, the insurer stopped all payments and Mr. S. was charged his monthly credit insurance premiums.

Mr. S. approached OLHI seeking to have his mortgage paid off in full. He believed this was appropriate because he was certified as being “totally disabled” by the RRQ in 2008. His medical condition had not improved since that date and he thought he was unable to work at any occupation.

Our DRO explained that it was typical that disability benefits would be paid for an initial period (in this case 12 months) based on inability to perform one’s own occupation. However, after that period, Mr. S. would need to demonstrate that he was unable to perform any occupation for the benefits to continue. She further explained that the RRQ’s determination that he was totally disabled did not necessarily prove that he was “unable to perform any occupation,” the standard for receiving benefits under the policy.

The DRO advised Mr. S. that before accessing OLHI’s complaint process, he would first have to complete the insurer’s internal complaints process. She suggested he write the insurer and formally ask for a review of his file, including all the facts he had shared with OLHI.

Approximately a month later, Mr. S. called OLHI again and advised he had received a call from the insurer offering to pay off a portion of the mortgage debt. He did not understand on what basis the amount was offered or whether the insurer had accepted his disability. Our DRO suggested Mr. S. submit his outstanding questions to the insurer and consider making a counter-offer.

Several months later, Mr. S. called our DRO to update her on the matter. He reported that over the preceeding months he and the insurer had a series of discussions. Several offers and counter offers were made on both sides. Eventually, his complaint was escalated through the insurer’s internal complaint process to its Ombudsman. In the end, the insurer agreed to pay the consumer’s $20,000 mortgage in full. In exchange, Mr. S. agreed to waive his entitlement to payment of the additional 50% benefits under the contract and to forgo reimbursement of the credit insurance premiums.

Mr. S. was pleased that he no longer had to worry about making his mortgage payments, given his age and inability to work, and thanked our DRO for her assistance in explaining how to proceed through the insurer’s complaint process.

 

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.