Case Study - OLHI - OmbudService for Life & Health Insurance | Resolution of your Canadian Insurance Concerns | OLHI

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

Mrs. T. purchased medical travel insurance ahead of a trip abroad. On that holiday, she fell ill and had to be treated in hospital. Afterward, she submitted her claim. It was declined because the insurance plan did not cover anyone who had been treated for three specific medical conditions. In its final position letter, the insurance company wrote that Mrs. T. had been treated for these conditions.

Mrs. T. contacted OLHI, asking for a free, independent review of her case. She told our Dispute Resolution Officer (DRO) that she had been diagnosed and treated for two of the medical conditions. But she had never been diagnosed or treated for the third condition: hypertension/high blood pressure.

OLHI’s DRO asked Mrs. T. and her insurance company to provide all their information relating to this case. In his review, he found that Mrs. T. was taking a medication for stroke management. The medication prescribed is also used to treat blood pressure. However, this was not the reason why it was prescribed for Mrs. T. In her case, it was for stroke management.

The DRO recommended that the case be escalated to an OmbudService Officer (OSO) for further investigation. Looking at all the files, the OSO read that Mrs. T.’s doctor had confirmed with the insurance company that she had never been diagnosed with high blood pressure. Although it was acknowledged that this particular medication is often prescribed for hypertension, Mrs. T. was taking it to control her history with strokes – and not hypertension/high blood pressure.

The OSO reached out to Mrs. T.’s insurance company and recommended they revisit the case. Because of a history of strokes, controlling blood pressure was necessary but it did not mean that she was hypertensive. The insurance company agreed with the OSO’s suggestion and paid out Mrs. T.’s claim for her hospital 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. and Mrs. H. applied for life insurance and were approved. When her husband died several months later, Mrs. H. claimed the benefits under the policy. The insurance company denied the claim for failing to disclose information about Mr. H.’s health.

Mrs. H. brought her final position letter to OLHI. She explained to our Dispute Resolution Officer (DRO) that a nurse had come to their home on behalf of the insurance company to collect blood and urine samples and fill out a questionnaire. During their conversation, Mr. H. told her about his high iron levels and his visits to a hematologist. The nurse noted “blood work normal” in her report despite his disclosure. Mrs. H. and her husband gathered the high iron was not important since the nurse did not take it into account, nor did the insurance company analyze his blood for this.

After his review of the information from Mrs. H. and the insurance company, the DRO recommended an OmbudService Officer (OSO) investigate further.

The OSO discovered that the company had not contacted the nurse to find out more about her visit with Mr. and Mrs. H. He recommended Mrs. H. contact this nurse, to see if she could validate their conversation. The nurse was unable to recall the specifics of their meeting.

While Mr. H.’s medical records showed he had been diagnosed with a blood condition, it was not disclosed in his insurance application. However, Mr. H. had signed this application, along with the report that the nurse prepared, confirming that all information provided was accurate. For this reason, the OSO recommended that there was no reason to further pursue this complaint.

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. R. frequently traveled out of country. She purchased a travel health insurance plan that would cover her for 35 days every time she left Canada. She departed in February and in May, while still on her holiday, she suffered a major illness, was hospitalized and passed away two weeks later.

While Mrs. R. was in hospital, her son, Mr. R., became involved. When he and the doctors reached out to the insurance company, the company confirmed that it would be able to help. Mrs. R. was transferred from one hospital to another for specialized care – a transfer that the company helped coordinate.

The insurance company denied the claim because the policy’s coverage had expired. In its final position letter, the company told Mr. R. about how OLHI reviews matters that consumers have not been able to resolve with their company. He contacted OLHI and asked a Dispute Resolution Officer (DRO) to become involved.

Mr. R. told the DRO that the company confirmed several times that his mother would be covered by the policy. He had no idea that her coverage was for only 35 days because he did not find this out from the company until after incurring costs.

Because of the complexity of the complaint, the DRO recommended that an OmbudService Officer (OSO) become involved to further delve into the investigation and to determine whether there were grounds for conciliation.

The OSO reviewed documents provided by all parties. He also listened to the recordings of telephone calls between Mr. R. and the company, as well as between the hospital and the company. In these calls, the company said that it would help with the hospital transfer but that it was not a guarantee of coverage because the claim still had to be processed and reviewed for approval. In those conversations, the company did not yet know when Mrs. R. had left on her out-of-country trip.

The OSO recommended that there were no grounds to pursue. The company’s claims process included confirming the coverage period. He also agreed that while the company said that Mrs. R. had insurance coverage, it also said that her claim still had to be reviewed to confirm she met the policy’s terms of coverage.

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.

Ms. C. worked as an office administrator, a predominantly sedentary role. She began to experience medical conditions that affected her back. Her employer’s group disability insurance plan covered her short-term disability claim. After several months, the insurance company denied Ms. C.’s coverage for long-term disability (LTD), stating that her illness did not prevent her from performing her job. The final position letter explained that Ms. C’s illness lacked clinical medical information to satisfy the terms of the disability contract.

After receiving this letter, which pointed to OLHI as an independent dispute resolution service, Ms. C. approached OLHI. In her review, OLHI’s Dispute Resolution Officer (DRO) noted that medical reports determined Ms. C. was not fit for work and that her condition was deteriorating. Meanwhile, the insurance company interpreted the reports differently, finding there was an improvement in her condition. The DRO also questioned whether the insurance company was relying too much on looking for neurological evidence that did not directly correlate with Ms. C.’s diagnosis from her doctor and specialist.

With these questions in mind, the DRO recommended an OmbudService Officer (OSO) further investigate Ms. C.’s complaint.

OLHI’s OSO learned that the tests conducted on Ms. C. returned with negative or mild/moderate results. Medical reports recommended that she could still perform sedentary or light duties, fitting with her job description, and her doctor supported a gradual return to work program. However, Ms. C.’s employer declined the program and instead ordered an independent medical examination, which concluded that she was not fit to work. Meanwhile, other conflicting medical reports suggested that Ms. C.’s condition was deteriorating because of an unhealthy lifestyle and not because of her diagnosis affecting her back.

Given the conflicting information and the employer’s refusal to have Ms. C. return to work because of its own medical findings, the OSO recommended that the insurance company and the employer reach an agreement. With OLHI’s recommendation, Ms. C. was able to reach a settlement.

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. U. purchased life insurance in 2006. She explained to her agent that she only wanted a policy that would cover her for 10 years and that she planned to cancel when the term expired. She said she would not be able to afford the new premiums, which would rise dramatically after 10 years.

Mrs. U.’s agent explained that a renewal notice would arrive in the mail but that she would call her before the policy was up for renewal, to confirm her intention to cancel.

In 2016, the policy’s 10-year term expired. Mrs. U. did not receive a phone call. Instead, her policy automatically renewed and higher premiums were taken out of her bank account. She contacted the insurance company and asked to cancel her life insurance policy and be reimbursed the cost of the new premiums.

Mrs. U.’s insurance company declined her request to be reimbursed. Its final position letter outlined that a renewal notice had been sent to her and she did not respond, so the policy was automatically renewed.

Mrs. U. brought this letter to OLHI for a review of her complaint. OLHI’s Dispute Resolution Officer (DRO) asked her and the insurance company to send all their documents relevant to this case. In his review, the DRO studied the policy contract and also learned from Mrs. U. that she had not expected the policy to automatically renew. She thought that if she did not renew, it would lapse.

OLHI’s DRO recommended that an OmbudService Officer (OSO) further review the contract language in Mrs. U.’s policy. The OSO discovered unclear wording about policy renewal. It implied that consumers had a choice – leading them to believe their approval was required ahead of renewal. The legal principle of contra proferentem dictates that unclear language allows for consumers’ interpretations of the contract.

The OSO recommended that Mrs. U. be reimbursed the majority of the premiums. Because the renewed policy was in force and would have paid out had she died, he recommended it was not possible to reimburse 100%. Mrs. U. and the insurance company agreed.

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 Mr. N. purchased life insurance in 2000, he explained to his agent that he wanted to pay the same monthly premium for the lifetime of the policy. His agent helped him fill out an application and also provided him with illustrations to show how his premium would never change.

Fifteen years later, Mr. N.’s premiums increased. He contacted the insurance company, asking that his previous premium be reinstated and that he be reimbursed the difference. In the final position letter, Mr. N.’s request was denied. The company pointed to the wording in the contract, which stated the level premium was for the first 10 years of the policy, after which time the cost of insurance could be increased. Mr. N. was given the option to reduce the sum insured, in order to bring his premiums back down to the original cost.

Mr. N. decided to bring this letter to OLHI. OLHI’s Dispute Resolution Officer (DRO) reviewed the contract and spoke with Mr. N., who told her that his insurance agent recently told him that he wholly believed he had sold him a level policy for its lifetime. The DRO also saw that the agent’s illustrations clearly indicated a monthly premium for life. She recommended that an OmbudService Officer (OSO) investigate further.

The OSO spoke with both Mr. N. and the insurance company to better understand their positions. She also delved deeper into the contract language, finding multiple examples of conflicting, ambiguous statements. In some instances, the policy stated the cost would be level for the duration of the policy. In others, it stated the cost could be adjusted.

The OSO approached the insurance company, pointing to the legal principle of contra proferentem. This principle states that, where there is unclear language in an insurance contract, consumers’ interpretations of the meaning of the contract are permitted. For this reason, she recommended that Mr. N.’s previous premium be reinstated and that he be reimbursed the difference in price. The insurance company agreed.

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.

In the 1980s, Mr. A. purchased an annuity so that he and his wife would have a monthly income over the course of their lives. When one passed away, the annuity would continue to provide income to the surviving spouse.

Mr. A. passed away in 2015 and, after this, payments stopped. The insurance company’s final position letter to Mrs. A. explained that it was a single life annuity, which terminated upon the annuitant’s death. Mr. A. was the annuitant.

Mrs. A. asked OLHI to become involved. Our Dispute Resolution Officer (DRO) received all relevant documents from her and the insurance company. He learned from Mrs. A. that, over the years, their advisor had consistently confirmed to them in conversations that they had a joint annuity policy. The insurance company had also sent them a letter confirming that payments would be made to Mr. A. for the rest of his life and, should he die before his wife, the payments would roll over to her.

The DRO recommended that the complaint be escalated to an OmbudService Officer (OSO) for additional investigation. The OSO’s review revealed that the policy was in fact referred to as a single life policy in the contract. It outlined a 15-year payment guarantee to Mr. A. If he died within that period, the remaining payments would transfer to his wife. However, if he died after 15 years, no further payments would be made. The insurance company had honoured its guarantee, making payments for three decades before Mr. A. died.

The OSO agreed that the contract clearly stated that this was a single life policy. However, he also felt that it was reasonable for Mr. and Mrs. A. to believe they had a joint annuity for several reasons: First, it was what they intended to buy. Second, their agent had confirmed to them that it was a joint annuity. And, third, the insurance company had also confirmed in a letter to them that payments would be made to Mrs. A. for the rest of her life, upon Mr. A.’s death.

After the OSO and the insurance company discussed all the facts, the company agreed to reconsider. They compensated Mrs. A. for the lost income and also resumed monthly payments.

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.

Ms. H. was injured in a work-related accident. For around 10 years, she received long-term disability (LTD) payments through her employer’s group benefits plan. After this time, the insurance company revisited her case, asking a doctor to perform an independent medical evaluation. The doctor found no functional impairment so Ms. H.’s benefits were terminated.

Ms. H. brought the insurance company’s final position letter to OLHI, asking a Dispute Resolution Officer (DRO) to review her case. The DRO asked her and the company for all their relevant documents. In his review, he read that the insurance company had conducted a transferable skills analysis several years earlier and they found she could not perform any jobs identified. In their file, they noted that they expected to make payments until Ms. H. turned 65 – but she was several years younger when the LTD benefits stopped.

The DRO recommended an OmbudService Officer (OSO) further investigate.

The OSO learned from the insurance company that it was their practice to review its cases over time. If necessary, they revised their findings based on new information, regardless of original predictions. In Ms. H.’s case, the insurance company followed up with her because she had been on a waiting list for surgery for many years. It turned out that the surgeon had lost her contact information and she was no longer on a waiting list. Ms. H. had never followed up with this surgeon since seeing him several years earlier, so she did not know that she was no longer on a list.

The insurance company requested a new evaluation by an independent doctor, who did not find any medical evidence supporting severe disability. She recommended that Ms. H. could work at a job that matched her abilities, experience and education – but required less physical activity.

OLHI’s OSO carefully reviewed all these facts from Ms. H. and from the insurance company. It was his recommendation that the insurance company’s decision be 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.

Ms. P. stopped working for her employer in April. For the next 90 days (until July), her employee benefits plan would accept any health expenses incurred before her last day of employment.

Before she stopped working, Ms. P. saw a health practitioner. He sent a claim submission to the insurance company twice: once in April and, when she didn’t get her claim paid, he sent it again in May at her request.

In August, the insurance company received the expense claim. It was declined because more than three months had passed since Ms. P. stopped working. They suggested that, if dissatisfied, she could seek an independent, free review of her case from OLHI.

Ms. P. explained to OLHI’s Dispute Resolution Officer (DRO) that she had spoken with the insurance company’s call centre in August. She was told that so long as she submitted her paperwork that month, she would get paid. Based on this information, the DRO recommended the case be escalated to an OmbudService Officer (OSO).

Investigating records from Ms. P. and the insurance company, the OSO found some discrepancies: the health practitioner said he sent documents in April and May but there was no evidence that the company received anything until August. The call centre recording revealed that the agent had incorrectly assumed that Ms. P. stopped working in May and that, based on this date, she had until August to submit her claim. Ms. P. did not correct the date, nor did the agent promise she would be paid.

The OSO determined that there was no hard evidence that the health practitioner had submitted a claim to the insurance company before the three months had ended. He also found that the call centre agent had provided the correct advice about the three-month period after an employee stops working – but he just used the wrong timeline, which was not corrected by Ms. P. Details about the claim period were also clearly outlined in the benefits booklet that Ms. P. received when she was hired.

For these reasons, OLHI’s OSO recommended that the insurance company’s decision be 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. F. had a term life insurance policy through this former employer, which also covered his wife as a dependent. On his 75th birthday, his coverage ended. He confirmed with the insurance company’s call centre that his wife’s coverage would continue because she was not yet 75. Not long thereafter, the company clarified that this particular policy had ended – but that there was an option to convert Mrs. F.’s coverage to an individual policy.

The insurance company explained that his wife’s policy had to be for a minimum of $50,000. However, Mr. F. wanted his terminated policy for $5,000 extended to his wife since she was not yet 75. When the insurance company denied his request, he brought the final position letter to OLHI and requested an independent review of his case.

OLHI’s Dispute Resolution Officer (DRO) read the insurance policy contract, which did outline that once coverage ended, the insurance company could issue an individual policy for an amount that did not exceed the old policy. For this reason, the DRO recommended the case be escalated to an OmbudService Officer (OSO) for further investigation.

After careful, thorough review, the OSO discovered that Mr. F. was confused about what a policy conversion entailed. He explained to Mr. F. that insurance coverage through an employer is known as “temporary insurance.” Once temporary insurance terminates, the policyholder has the option to convert that policy into an individual insurance policy. However, this conversion is not what Mr. F. was looking for; instead, he wanted his temporary insurance to continue until his wife turned 75. However, his policy stated that once the policyholder turned 75, all coverage for himself as well as his dependents would end.

As a result, the OSO maintained the insurance company’s 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.

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