Guide to Life Insurance Disputes

Don't agree with the result of a life insurance claim? What you can do if you have a complaint.

Have you lodged an insurance claim only to have it rejected? If you think that you're claim was unfairly dismissed, you have options. Every insurer has an internal dispute resolutions team that is ready to handle complaints from people who believe that they had a legitimate claim that was dismissed without payment.

Dispute resolution can be frustrating but it doesn't have to be a complicated process. This guide should help you understand the process of dispute resolution and what your options are should you still feel hard done by at the end of the process.

Make an enquiry for life insurance from Australian insurers

Steps to take to sort out life insurance disputes

It's crucial to familiarise yourself with the steps that you should take in the event of insurance disputes, as this will enable you to act more decisively and use your time wisely on the proper course of action in the event that you have a dispute that needs to be addressed. In the event of a complaint or dispute you should look at taking the following steps:

  1. Check your policy. Before doing anything make sure you've read through your policy to make sure you are actually covered. Check your policy, including the small print, to see whether you actually have a case or whether the insurance firm is acting in line with its terms and conditions.
  2. Speak to your provider. If you believe there is an issue after checking the policy, you should contact your insurer and explain your concerns and discuss what can be done to resolve the dispute. Often, a satisfactory conclusion can be reached simply by speaking to the insurer and discussing the issue.
  3. Put in a complaint. If you're unhappy with the resolution after speaking with your insurer, you will need to go through your insurers dispute resolution process. This generally requires putting your complaint in writing. Your insurer will give you a timeframe of when this issue should be resolved.
  4. Ombudsman. If you have gone through the dispute resolution process and you are still not satisfied with the outcome, you should contact the Financial Ombudsman Service (FOS). Escalating your dispute may mean that you have to wait even longer for a resolution but if you have exhausted other avenues, this may be the route to take in order to get the dispute resolved once and for all.

Pre-existing medical conditions and life insurance disputes

A common cause of life insurance disputes revolves around pre-existing medical conditions. Each year, the financial ombudsman is contacted by hundreds of cases of people following their income protection claim being rejected. The life insurance company has usually rejected the claim due to the policyholder not letting them know about a pre-existing medical condition related to their claim. These cases highlight the sheer importance of disclosing all known information to insurers before signing the contract of insurance. Many applicants will withhold details of pre-existing conditions or lifestyle habit in an attempt to save on their policy premiums. As part of the insureds duty of disclosure, it is their responsibility to state all known information regarding pre-existing medical conditions to their insurer to avoid this situation occurring.

Definition of a pre-existing medical condition

A pre-existing medical condition is commonly recognised as any condition:

  • That was previously diagnosed or investigated
  • Where there were symptoms that lead to the diagnosis prior to application
  • Or event that lead to the claim occurring took place
  • Prior to the official commencement date of the policy or the effective date of any increase of the policy sum-insured.

What are the requirements of the life insured under the duty of disclosure?

Under the insurance contract act of 1984, each applicant is required to state every matter that they know, or would be expected to know that is relevant to the insureds decision to provide cover and at what rate. Each applicant will be required to answer questions during the application regarding their health, occupation and lifestyle. It is safer to contact your insurer to discuss any matter that you are unsure about disclosing during the policy application to avoid any surprises at claim time.

Speak with an adviser about your life insurance options

Compare life insurance policies

Please enter your full name
Please enter a valid email address
It's important to give us a valid phone number
Gender
Smoker
Date of Birth
Coverage is the amount of money that you will be paid in the event of a claim. An insurance consultant can help you determine an appropriate amount. Calculator
Provides a lump sum payment if you become totally and permanently disabled and are unable to return to work.
Provides a lump sum payment if you suffer a serious medical condition. Cover can be taken out for 40-60 medical conditions depending on the policy you choose.
By submitting this form, you agree to the finder.com.au privacy policy
Get quotes

Compare Life insurance quotes from these direct brands

Rates last updated November 23rd, 2017
Name Product Maximum cover Maximum Entry Age Minimum Sum Insured Guaranteed Future Insurability Expiry Age Short Description
$15,000,000
69
$0
Yes
99
Get a quote for up to $15 million in life insurance cover. Cover can be tailored to meet your personal needs.
$1,500,000
65
$3,000
No
80
Flexible cover options to suit your budget. New eligible customers can receive 25,000 Velocity Points. Ends 31 Nov. Min monthly premium and T&Cs apply.
$1,500,000
65
$100,000
Yes
99
Receive a discount of 10% on life insurance as a Woolworths Rewards Member. T's and C's apply.
$2,000,000
59
$50,000
Yes
99
Get flexible life insurance up to the sum of $2,000,000.
$1,000,000
64
$100,000
No
99
Get a refund of 10% of the premiums you've paid (in the first 12 months) with The Real Reward™ .
$1,500,000
69
$0
Yes
99
A simple life insurance product that can offer up to $1,500,000 in a lump sum payment on death or diagnosis of terminal illness.

Compare up to 4 providers

Richard Laycock

Richard is the insurance editor at finder.com.au. He is on a mission to make insurance easier to understand.

Was this content helpful to you? No  Yes

Related Posts

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, read the PDS or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms and Conditions and Privacy Policy.
Ask a question