When it comes to severe illness benefit claims, the decisive issue is when the insured event occurred, not merely when the medical confirmation was issued, the National Financial Ombud Scheme (NFO) has ruled in a cancer patient’s dispute with Discovery Life.
The dispute concerned Discovery Life’s decision to decline the complainant’s claim under the cancer category of the severe illness benefit. Discovery did not dispute the diagnosis itself but argued that the claim arose on 21 October 2023, when cover had already lapsed because premiums had not been paid.
In response to an earlier provisional ruling by the NFO, Discovery Life said its policy terms clearly state that a “life-changing event” occurs only once a condition has been objectively confirmed, including through histological verification.
“The mere presence of symptoms, even if clinically suggestive, does not suffice to meet the contractual threshold for a valid claim under the severe illness benefit,” the insurer said.
The ombud questioned the insurer’s reliance on the 21 October 2023 date. A breast biopsy was performed on 18 October 2023, received on 19 October 2023 and reported as invasive breast carcinoma on 21 October 2023.
Discovery argued that the life-changing event occurred only on 21 October 2023. The NFO disagreed.
Denise Gabriels, Lead Ombud of the Life Insurance Division of the NFO, said the policy did not support the proposition that the claim event is deemed to occur only when the diagnosis is confirmed.
“Discovery Life has yet to point to the provision in the policy which stipulates that a life-changing event is deemed to have occurred on the date medical confirmation of a covered condition has been received.
“In the absence of a deeming provision, the date of the life-changing event is the actual date of occurrence. If the evidence proves that the insured met the qualifying criteria of the disease covered by the policy when the policy was in force, the insurer is liable.
“The fact that the proof – medical confirmation and histological verification – was received when the policy was out of force does not exclude a valid claim which arose when the policy was in force.
“The evidence showed that the complainant had experienced symptoms in September 2023 when the premiums were paid. These symptoms, together with the medical investigations, were consistent with and confirmed by the diagnosis of cancer in October 2023,” she said.
The NFO was satisfied that the evidence proved that the complainant met the qualifying criteria for the disease while cover was still in place.
Discovery was ordered to pay the claim, on the basis that the relevant event was the cancer itself, not the later paperwork confirming it.
Riaan van Reenen, the chief executive of Discovery Life, said the insurer respects the NFO’s role in clarifying ambiguity and resolving disputes fairly for consumers and financial institutions. “A diagnosis of cancer is deeply upsetting for any individual and their family, and we recognise the emotional toll such news brings.”
He said the dispute related to the timing of the contractual trigger for a severe illness benefit claim on a policy that was already out of force because of missed premiums. Discovery Life has paid the claim in full, with interest.
“We encourage clients to ensure their premiums and cover remain up to date, as this supports the efficient payment of claims when they are most needed,” Van Reenen said.
