The following article was published and paid for by Liberty Life on 24th June 2018 in the Sunday Times. This article looks into the portion of un-paid claims at Liberty Life and the reason for unpaid claims. Many will ask what the reason for un-paid claims is and in short there will be two main reasons:

1. The claim doesn’t qualify as a claim
2. Non-disclosures in policy

They go further to state that they have paid out R4.46 billion in 2017 and only 1.6% was not paid because of non-disclosure.

If we look at the figures, that means that R71 360 000 was not paid to the clients that have paid their premiums monthly for years on end.

When looking at Old Mutual’s claims statistics for 2017, they mention that 44 claims was declined due to non-disclosure this amounts to R 15 175 891.

Sanlam also had their claims statistics published for 2017. In total they declined 10 claims due to non-diclosure with a total amount of R 7 830 032.

Non-disclosure is looked at as something that is in minority when it comes to claims. The reality is the amount of clients that this affects every year.

Why is non-disclosures so important?

Once the claim gets submitted at the Insurance Claims department, there are a lot of documents that needs to accompany the claim. The relevant doctor’s reports and forms. What the insurance company doesn’t tell the clients is that they as for the full Medical Aid Claims History from the client’s medical provider. They use a team of claims administrators to investigate into your medical history and contact all the doctors on your records for reports on why you visited them. If any information from the doctors, doesn’t correspond with your application submitted. Then there are material grounds to repudiate the claim based on non-disclosure.

Do you still think your life policy will pay out?

Did you mention every doctor saw in the last 15 years being with your health provider?

If you have any doubt, contact us to help you NOW eliminate the possibility of a non-disclosure.

Now lets look at what was published in the Sunday Times…

Many of us do not realise the true value of insurance until an unforeseen event or accident happens. When that day comes, we are quick to ask if there was insurance in place. It is not a grudge purchase, but an absolute necessity.

It is therefore vital you ensure that your insurance policy is valid and that your claim will be paid as expected.

Henk Meintjes, head of risk product development at Liberty, says: “When you consider that Liberty paid out R4.46-billion in 2017, the need for long-term insurance cover becomes clear. This is money that our clients and their families need to manage their finances through these difficult times.”

Life and health insurance helps you and your family make lifestyle changes and pay monthly expenses following a death, critical illness or disability that prevents you from earning your normal income.

Unfortunately, not all claims submitted to insurers are valid. Across all claims received by Liberty in 2017:
•8.6% were for conditions that did not meet claims requirements; and
•1.6% were declined due to non-disclosure.

Meintjes explains non-disclosure: “When important medical, financial, lifestyle or occupational questions are answered incorrectly or where important information is omitted when cover is first bought, that is non-disclosure. It ranges from deliberate fraud to innocent omissions where certain information is simply forgotten.”

When insurers find out clients failed to answer questions on their application forms fully or honestly, they may reconstruct the underwriting decision. If the information was relevant to the underwriting of the policy, the cover may be declined or offered on different terms, including medical loadings, exclusions or limits on the sum assured. Unfortunately this new information is often only uncovered at claim stage and may result in the claim being repudiated.

Non-disclosure most often occurs in questions related to medical history such as psychological disorders but also in occupational and financial questions. When new policyholders fail to reveal the full information when applying, it could delay the underwriting process and lead to the cancellation of a specific benefit, a reduced payment at claim stage, or even the entire policy being cancelled.

For this reason it is important for you to consider carefully all the questions on your insurance policy application forms.

“The temptation to withhold sensitive information in order to reduce premiums is simply not worth it. If you are concerned about revealing private information to your financial adviser, consider tele-underwriting services instead,” says Meintjes.

Once your application has been processed and your policy documents issued, you must check the documents thoroughly, paying particular attention to the summary of disclosures. If any information needs to be amended, you should contact your financial adviser or the insurer directly to address these inaccuracies.

As your life changes, so do your insurance needs. Take the time to review your insurance cover regularly to ensure it remains in line with your needs.

Liberty encourages clients to familiarise themselves with the claims criteria and to consult their financial advisers to ensure they have the correct cover in place.

Now after you have read the document from them, do you see how the bring up the issue of non-disclosure. They refer to it as the client’s responsibility to disclose relevant information upfront.

Just take a minute and do the this exersize.

How long have you been with your medical aid provider? Now, write down the number of doctors you have been to with the reasons for consultations since then.

It is physically impossible to remember each docter, reason as well as dates.

Read more…

https://www.timeslive.co.za/sunday-times/business/2018-06-24-why-insurers-dont-pay-life-and-health-insurance-claims/