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

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.

Ms. H. worked at the front desk of her family’s automotive shop. Her responsibilities were administrative in nature: assisting customers on the phone and in person, processing warranties, selling parts over the counter and traveling around the city to pick up parts. In October, she applied for disability under the company’s group plan, indicating on the application that she was diagnosed with a respiratory disease.

Three months later, Ms. H.’s family doctor recommended that she be treated with steroids and other medications for respiratory tract infections. She concluded that Ms. H. was not fit for work, except for very sedentary work in a clean environment that would not affect her respiratory disease. Ms. H applied for and was granted disability through the Canadian Pension Plan because her chronic illness and limitations met CPP’s definition of “disabled.”

Ms. H.’s insurance company, through her employee group plan, however, declined her disability claim. They said she had suffered from respiratory problems for many years, before the insurance coverage began. This made her illness pre-existing. The company also said that she was not permanently employed for 24 hours per week and was therefore not insurable.

OLHI became involved when Ms. H. sent us the company’s final position letter and all her documentary evidence. She explained to our Dispute Resolution Officer (DRO) that she was very unwell and unable to work a steady job. The DRO reviewed Ms. H.’s paperwork, as well as files that the insurance company sent. Medical reports confirmed her condition was worsening and made work impossible. With this information, the DRO recommended an OmbudService Officer (OSO) investigate.

The OSO discovered in the insurance policy booklet that an employee’s eligibility for benefits is based on the number of hours worked. A minimum of 24 hours of work was required each week. Ms. H.’s employer could not provide evidence of her hours worked and also admitted that they had paid her when she was ill, even when she did not work. Despite her illness, and despite the insurance company’s empathy, the OSO agreed that Ms. H. could not be covered under the plan.

 

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. N. was a 54-year-old floor porter, moving packages, equipment and other items around a hospital emergency room. His job required him to be on his feet eight hours a day. His uncontrolled diabetes led to a bone infection in his right big toe and he went on disability benefits through his employer’s group insurance plan. The insurance policy provided disability payments for the first 24 months so long as Mr. N. was not able to perform the essential duties of his job.

For the first six months, the insurance company paid Mr. N.’s disability benefits. Then, the company stopped, explaining that his infection was resolved and his condition did not prevent him from returning to work.

Mr. N. brought the company’s final position letter to OLHI. He told our Dispute Resolution Officer (DRO) that he could not return to his job because it required that he wear safety shoes. The bone infection had caused a deformity and limited sensation in his leg. The constant friction caused pain when he wore safety shoes. Additionally, he had dizziness from his diabetes.

Our DRO carefully reviewed all Mr. N.’s files, as well as the files sent by the insurance company. She learned that Mr. N.’s medical records confirmed that it was unlikely he could return to work in steel-toed boots. He was unable to properly stand on his feet, his walking was slow and his reflexes impaired. Mr. N.’s employer also confirmed that safety shoes were mandatory for the job.

The DRO recommended an OmbudService Officer (OSO) conduct a further review based on merit, given the physical nature of Mr. N.’s work. The OSO contacted the insurance company after his own through review, recommending that the medical evidence was quite definitive and prevented Mr. N. from performing the duties of his job. The insurance company agreed and continued to pay for his disability benefits for the rest of the 24 months.

 

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. 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.

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. 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. 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.