Employers Liability Decision Reference 2022-0223

• Case Outcome: Rejected
• Reference: 2022-0223
• Date: 01 July 2022
• Year: 2022
• Subject Matter: Employers Liability
• Finantial Sector: Insurance
• Conducts Complained Of: Lapse/cancellation of policy,Rejection of claim - non-disclosure

Decision Ref:

2022-0223

Sector:

Insurance

Product / Service:

Employers Liability

Conduct(s) complained of:

Lapse/cancellation of policy

Rejection of claim - non-disclosure

Outcome:

Rejected

LEGALLY BINDING DECISION OF THE FINANCIAL SERVICES AND PENSIONS OMBUDSMAN

This complaint arises from an Executive Income Protection Plan incepted with the Provider

on 6 March 2012. The Complainant was not the policyholder, but she makes this complaint

in her capacity as an actual or potential beneficiary of a “long-term financial service” within

the meaning of the Financial Services and Pensions Ombudsman Act 2017. The Policyholder

was the Complainant’s employer. The Complainant, as the life assured, completed the

application for cover through an Insurance Intermediary (‘the broker’). The Provider was the

Insurer, responsible for underwriting the applications for cover and assessing claims.

This complaint concerns the Provider’s decision in July 2018 to decline the Complainant’s

income protection claim and to cancel the policy from inception, on the basis that she had

failed to disclose her full medical history when applying for the cover.

The Complainant’s Case

The Complainant completed and submitted an income protection Claim Form to the

Provider on 28 May 2018, wherein she advised that she had not attended worked since 22

May 2018 due to “Stress, lack of sleep, stress, anxiety”.

Following its claim assessment, the Provider wrote to the Complainant on 23 July 2018 to

advise that she had failed to disclose her full medical history when applying for cover and

that its underwriters had confirmed that if it had been aware of such information, when

considering her policy application, it would not have been in a position to offer terms of

cover. As a result, the Provider declined the Complainant’s income protection claim and

- 2 -

/Cont’d…

voided the Executive Income Protection Plan from inception, and it refunded to the

Policyholder all premiums paid since the commencement of the policy.

The Complainant wrote to the Provider on 13 September 2018 to appeal its decision to

decline her income protection claim and void the policy from inception, as follows:

“ … I feel my initial application form was rushed and not given the due time needed,

and my Nurse Medical was loosely carried out and the Nurse made some grave errors

in completing the application form by giving incorrect answers. I am disputing the

way the Nurse Medical was carried out, for example, “Have all “Yes” questions been

fully answered = YES”. This should have been a “No” answer. Of course the Nurse

Medical would not have expected me to remember/know all the dates/years of the

scans/x-ray’s etc, but the Nurse should have requested this information from my GP

especially as I answered “yes” which covered all parts of the question, not just Bloods.

In my original application I consented for a PMA [(GP Report)] to be completed but

this was never done. I have been blessed with good health all of my life, I can

occasionally be forgetful when I am very busy (managing a [place of employment]

with 50 staff with a €3 million turnover), as can be verified in my Medical Notes where

I complained of worrying about poor memory over the years. There was never a

question on either the application form or the nurse medical to ask me about poor

memory. I did attend for an MRI due to my concerns regarding my memory loss and

this came back clear. My GP advised me at the time it was nothing more than a busy

mind trying to retain everything.

I think that it is unreasonable and unfair that a PMA was not done as I gave full

permission for this on my application form. It was never explained to me at the time

of the nurse medical that any omissions would make this application invalid, and as

per the Nurse Medical I was never encouraged to pursue any additional medical

advice and more importantly when the nurse medical was finished I was not given

the opportunity by the nurse to scroll back and review the questions from the start, I

had answered before I signed, as these were all on the nurses laptop. If that had been

done, mistakes would have been spotted then in 2012 and corrected immediately.

Receiving this information in July 2018 was far too late to review and correct. I was

simply asked to sign the form by the nurse. I feel there was/is a duty of care by the

Nurse to go through what I had completed.

To the best of my knowledge for all current Income Protection Applications, the client

is now afforded the opportunity to review all questions answered before the

application is fully submitted to the Life Company, therein removing the margin for

error.

I would plead with you not to reject my claim/application. I have worked from

inception date of the policy in 2012 to the current time 2018 without every (sic) have

(sic) any claim on my policy. I need the assurance going forward that I am protected

for the remainder of my working life as it is my full intention to work on for another

number of years”.

- 3 -

/Cont’d…

The Complainant enclosed additional correspondence to the Provider in support of her

appeal.

In that regard, in the enclosed Report dated 23 July 2018, the Complainant’s GP stated that:

“[The Complainant] aged (sic) is 60yrs. She finds herself currently in a very stressful

situation and has severe difficulty with anxiety as a direct result. She is unable to

sleep and is anxious, emotional and distressed. She is suffering panic attacks and is

unable to concentrate. She never felt like this in the past. I have advised against work

as her job is extremely stressful. I have commenced her on medication and advised

counselling. This is completely different to any situation she ever encountered in the

past.

I wish to clarify her past medical history. [The Complainant] attended me in 2004 with

a bereavement reaction of tiredness and low mood which I documented in her notes

as such. She needed to work as she was in a busy job and indeed she did and was fit

to do so. I treated her for a very short time (my notes show a period of 5 weeks only)

with a low dose SSRI [selective serotonin reuptake inhibitor] to help her to get on

with her busy life. She has been a regular patient since that time over 14 years and

did not require any further treatment for mood. [The Complainant] had not

considered this of any consequence.

In 2012 she embarked on an insurance policy. There was no PMA requested and if

there had been it would have included her brief sadness reaction in 2004. I wonder

why this was not requested. I also insist that she dis (sic) not suffer any mental health

issues for over 16 years.

Mild depression is not anxiety and [the Complainant] never suffered anxiety in the

past. I concur strongly with her assertion that she did not suffer from any mental

health issues at any time in the past but a natural response to a personal loss in the

dim distant past that bears no relationship to her current anxiety disorder. Further

should I have been given the opportunity to provide a PMA report the current

situation would not have arisen”.

In the enclosed Report dated 9 August 2018, the Complainant’s treating Occupational

Physician stated that:

“[The Complainant] has asked me to write this report in support for her appeal

against [the Provider’s] decision to decline/terminate her claim. In addition to her

own history she has provided me with documents from [the Provider] outlining its

reasons for terminating her claim.

My first impression on reading your documentation, is that some clerk was asked to

find every possible thing in the doctors PMA that could suggest withholding of

material information, and provided a comprehensive list, all of which are not

factually correct.