The Ombudsman for Long-term insurance mediates in disputes between members of the long-term insurance industry and policyholders. As we await the release of the Ombud’s 2020 Annual Report to see the impact of the current “new normal” in the financial services industry, the Ombud has released guidelines for insurers with regards to their responses to the Ombud.
Following the receipt of a complaint from a policyholder, insurers are requested to send the Ombud a first response containing the following information:
Settlements
- If the insurer decides to settle a matter after receipt of the complaint, the Ombud’s office, and not the complainant, must be notified of the decision.
- If there is a payment to be made, the amount of the payment and any interest which is due, should be included in the letter to the Ombud. The Ombud’s office will then inform the complainant what to expect.
- After payment, confirmation thereof, including the date, the amount and the bank account number should be sent to the Ombud’s office.
- If a matter is settled on a so-called ex gratia basis, where the insurer contend that it is not in terms of the policy, the insurer should consider sending a settlement letter prior to payment.
Other responses
Where insurers are not settling a complaint in their first response to the office, they should provide a complete response raising all the defences on which they wish to rely. Insurers must provide supporting documentation, as well as the name and telephone number of the person with whom the Ombud can discuss the complaint, if necessary.
The following is a list of the minimum substantiating documents which must be attached to the insurer’s first response:
| Nature of complaint | Documents required from insurer |
| Poor communications/documents or information not supplied/poor service | Policy and schedule Endorsements – if applicable Copies of correspondence exchanged |
| Claims declined (policy terms or conditions not recognised or met) | Application form or telesale recording– if applicable Policy and schedule Letter declining claim Medical evidence – if applicable Any other claim documentation Death certificate – if applicable Copies of relevant correspondence |
| Claims declined (non-disclosure) | Policy and schedule Application form or telesale recording Medical and other evidence Letter declining claim Schedule of total premiums less administration costs Counter-offer – if applicable Copies of relevant correspondence |
| Dissatisfaction with policy performance and maturity values | Policy and schedule Breakdown of policy performance Actuarial certificate – if necessary Copies of relevant correspondence |
| Dissatisfaction with surrender or paid-up values | Policy and schedule Calculation of costs and expenses Breakdown of policy performance Surrender Quotation – if applicable Actuarial certificate – if necessary Copies of relevant correspondence |
| Lapsing / non-payment of premiums | Policy and schedule Notification of non-payment Premium reconciliation Reinstatements – if any Confirmation of lapse letter Copies of relevant correspondence |
| Declined based on waiting period | Policy and schedule Membership certificate – if any Application form or telesale recording Record of premium payments – if relevant Copies of relevant correspondence |
Advisers may find the above of interest when assisting clients with such complaints.
Hi, my insurance claim was rejected. I had flooding damage to my apartment after maintenance agreed to have rubber roofing contractors come and remove layers of roof without checking up and coming weather and 2 days after they started rain poured into our apartment for 3 weeks approx. Non stop flooding damage happened to the apartment as well as my bed and grocery cupboards as well as the kitchen cupboards, laminate flooring etc and now the flat is full of a mould I cannot get rid of that is affecting me and my daughters health. Their reason for rejection was that they said it was damage over time but it wasn’t. I had no problems before this at all