An insurer cannot simply rely on an omitted medical test to reject a claim if it cannot show that the non-disclosure was material to its assessment of the risk.
That is the lesson from an Appeal Tribunal decision involving Bidvest Life, which was ordered to pay an income-protection claim after initially rejecting it based on alleged medical non-disclosure. The case is among those highlighted in the National Financial Ombud Scheme’s 2025 annual report, released in June.
Bidvest Life declined Ms A’s income-protection claim against Bidvest Life because of alleged non-disclosure at application stage. She was unaware that her broker had completed an online application containing different questions from the physical application she completed.
The insurer stated that the policy commenced on 1 September 2022 (accepted on 4 August 2022). During claim assessment, it emerged that Ms A had consulted her gynaecologist in July 2022 and was diagnosed with elevated uterine artery pressure and prescribed Disprin to reduce pregnancy-related risks. The insurer stated that if this information had been disclosed, the application would not have been accepted, leading to the policy being voided and the claim declined.
The Division’s provisional ruling stated that the broker was an independent intermediary, not an agent of the insurer. As a result, the insurer was entitled to rely on the electronic application and short medical report, not the physical forms completed by Ms A.
Medical evidence showed elevated uterine artery pressure was identified on 6 July 2022 (before cover commenced), with follow-up confirmation after commencement.
Although Ms A argued the condition was not abnormal and that pregnancy-related tests with normal results could be ignored, the application questions required disclosure of all tests or investigations performed or pending, regardless of outcome. The provisional ruling found that by not disclosing this information, the insurer was deprived of the opportunity to properly assess the risk.
Applying the materiality test under rule 21 of the Policyholder Protection Rules under the Long-term Insurance Act, the insurer’s decision to void the policy and decline the claim was upheld.
The complainant did not accept the provisional ruling, and the matter was reconsidered.
Final ruling
The electronic application form constituted an offer for insurance, and because Bidvest had not seen the paper application when issuing the policy, it could not have accepted it.
Based on the electronic application, at least one medical question was incorrectly answered. Bidvest further argued that material medical information was also not disclosed on the paper application, specifically regarding a gynaecological condition.
Ms A’s consultation in July 2022 and being advised of elevated uterine pressure, which required monitoring and further investigation, should have been disclosed because potential complications were unknown at the time. Bidvest was entitled to this medical information properly to assess the risk. If it had been disclosed, the insurer would have deferred the application until after childbirth.
The provisional ruling was confirmed as the final ruling.
Ms A applied for leave to appeal, which was granted.
Appeal finding
In its appeal submissions, Bidvest argued that Ms A should reasonably have disclosed details of an antenatal consultation on 6 July 2022, during which elevated uterine artery pressure was identified and Disprin recommended. Given the consultation occurred three weeks before her insurance application, Bidvest contended a reasonable applicant would have appreciated its relevance, particularly in light of Ms A’s heightened concern due to a previous pregnancy.
Bidvest further argued that elevated uterine artery pressure is a clinically significant indicator of obstetric risk and that recommending Disprin reflected an elevated risk profile.
The Appeal Tribunal examined the medical questions in the electronic application. Regarding the question on conditions requiring prescription medication, the Tribunal found Ms A’s negative answer to be correct, because Disprin is an over-the-counter medication, was not prescribed for more than one month, and was recommended on an optional basis.
On the question concerning gynaecological conditions or symptoms requiring further investigation or treatment, the Tribunal held that elevated uterine artery pressure is not, in itself, a gynaecological condition or symptom, nor was there expert evidence to support Bidvest’s claim.
The gynaecologist’s feedback indicated no clinically significant diagnosis, no prescription medication, and no ongoing monitoring, supporting the conclusion that Ms A’s answer was truthful and not a material non-disclosure.
As to the question on tests or investigations performed, the Tribunal accepted that the Doppler ultrasound was a diagnostic test, and Ms A’s negative answer constituted a non-disclosure. However, applying established legal principles, the Tribunal found the non-disclosure was not material.
Relying on the Constitutional Court case of Swanepoel N.O. (Executor in the Estate Late Mignon Adelia Steyn) v Profmed Medical Scheme, it held that a medical examination and a diagnostic medical procedure that resulted in no material diagnosis could not be classified as a material non-disclosure, and a prudent, reasonable person would not regard it as such.
The Tribunal concluded that Bidvest had failed to prove materiality. Accordingly, the appeal was upheld, and Bidvest was ordered to honour Ms A’s claim, with interest.
