Pyramid Comment

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Tuesday, November 14, 2006

Critical Illness Insurance

Based on the original posting, January 2006

The following is a record of my experience only. It has taken some years to place this account in the public domain, but it is something I made very clear I would do. Today my view of fairness is probably taken as being naïve, but playing fair is basic decent behaviour. Old fashioned maybe, but very effective when ruthlessly executed. If no complaint is lodged, much is excused and forgotten and the precedent is not created. It is a prime reason that objectionable behaviour still occurs. Making money is a worshipped ideal as long as somebody else gets hurt. Such an attitude can only be viewed as realistic when the perceived 'winner' becomes the real 'loser'. Some actually believe that wealth creation is a real concept. When it's based on a fixed resource it can only be redistribution. Take from one and hand over to another. Winners And Losers game.


Critical Illness Insurance concerns the business of not paying out claims. There's small print and invisible print.

For a selection (not comprehensive) of critical illnesses see:

Critical Illnesses

Today the Freedom of Information Act exists that may enable the forced extraction of crucial information that cannot legally be withheld, but do notice:

"Everyone has the right to request information..."

Requesting does not mean receiving.

Such as the definition of associated symptoms or manifestations (see below).

but



Several years ago I had some protracted dealings concerned with critical illness insurance (around 2 years for the same particular claim - ultimately successful, but at great personal cost and that is not financial cost) and the nasty way in which one particular company operated. Hopefully, attitudes should have changed, but don't waste your time living in hope.

Abbey Life - the original link is now dead, like the Lloyds TSB connection: Abbey Life has been sold by Lloyds TSB/Scottish Widows. So, Lloyds+TSB+Scottish Widows (-Abbey Life) group involves the banking and insurance business. Completely buried.

My advice if you ever consider such insurance is the minimum of a full medical, ideally by the company offering ‘cover’. Insist upon the full examination. They will almost certainly advise against this, it being unnecessary. It is absolutely essential you have this examination.

All the areas of cover MUST be examined to demonstrate you are FREE from any illness within these areas, assuming you are, of course. If you don’t you are inviting major problems. MAJOR problems. This is not a guarantee, but if you make a legitimate claim on your insurance, it should make an unjustified rejection much more difficult for the assurer/insurer to argue.

Clearly, I have survived a critical situation, in spite of Abbey Life piling on the pressure by continued rejection: undefined pre-existing conditions. Or ‘manifestations’ or ‘associated symptoms’.

Initially this company actually claimed it had been on the advice of their Chief Medical Officer (CMO). It became clear (months later) that was not the case. Some administrator had made the decision. Medically qualified? I doubt it. But a letter indicating that on the advice of the CMO my claim was declined. They really enjoy using the word DECLINE. They mean refused. Rejected.

A rubber stamping action. The CMO did exist. I checked in the appropriate register of doctors, but interestingly, while my dealings with the General Medical Council (see below) were being blocked (over a 4-month period), this good doctor retired. Pressure in the office was the justification for the delay: 4 months!

My question for the GMC was simply about a conflict of interests. How the Chief Medical Officer, employed by the assurance company (in a full-time or a lesser capacity is not known) could give an unbiased opinion in an issue involving the employer. The hippocratic oath was also compromised in that I argued that this CMO claimed to have certain knowledge that was not known to my doctors to facilitate the rejection of my claim. Remarkable in that assertions were made before a diagnosis. In fact, even before a serious problem was even considered. And the clear implication that I had known of my condition and had done nothing about it. My doctors supported totally the reality of me not being in a position to know.

It took high-tech diagnostics to determine I had a problem and to then define it. Abbey Life asserted that for a long time before the diagnosis, I had "associated symptoms" - UNDEFINED and UNQUALIFIED. Still, to this day, UNDEFINED and UNQUALIFIED by Abbey Life. The question remains symptoms of... what? If you have no diagnosis of any illness (real or imagined) then you can have no associated symptoms. Logical? Absolutely.

Manifestations. Associated symptoms. Undefined. Meaningless. Claim rejected.

On the 4.12.98 a report was published in The Times concerning the Lords' debate: No pre-existing illness until diagnosis - Cook vs Financial Insurance Co Ltd. According to Abbey Life, if a condition is later shown to have (probably) existed at an earlier time then the condition is retrospectively excluded. Even if it was not possible for a GP to have suspected a condition (critical illness diagnosis usually needs the involvement of a specialist).

This is the reason that the medical is absolutely essential. If there was no sign of any particular condition(s), and it was signed off as such by the assurer, then this cannot happen.

The view that my doctor was incompetent and/or negligent is implicit. A specialist only becomes involved when an undiagnosed problem is unexplained. Only then can a condition be suspected and later defined upon diagnosis.

Delegated authority was given to claims underwriters to make complex medical decisions, but Abbey Life refused to expand on the “associated symptoms” which prejudiced my claim, alleged to have existed at least 14 months before the diagnosis. The reason why my claim was originally refused has never been declared. Access to a medical history makes it possible to select ('cherry pick') appropriate observations and assign them as symptoms of an earlier unknown condition, but so dated to place that condition outside cover. Perverse and risible.

A major loophole became clear. The Abbey Life MortgageMaster (endowment) product as it stood was not regulated by any agency. The Personal Investment Authority (regulatory) ambit only involved the investment part and the Association of British Insurers (non-regulatory) did not see any issues in the insurance part.

The Abbey Life stance was that they knew more by working backwards from the examination of medical reports written over one year later than is possible to know and used the principle of retrospective exclusion. Excluding from cover at a later date when information is known that couldn’t be known at the earlier time. A definition of pre-empting the future. Remember also that when a claim is made, after a critical illness has arisen, the complete medical history becomes available to the assurer. Selection of anything associated or not can then be made. Hence the other term: "associated symptoms". Undefined and therefore unchallengeable. Total hindsight. Knowing the results of the future but pre-dating expeditiously. Alleged prior symptoms were never and have never been declared. The true reason for the claim refusal has never been divulged. On this basis the claim was refused.

In my case, the reason? Pre-existing conditions. Manifestations. Associated symptoms. No explanation. No evidence to justify rejection. Just assertion. Nothing else. NOTHING else.

A person suffering from a critical illness is likely to die eventually. The longer a claim action continues, the higher the likelihood of the claimant expiring. Of course, it was I who made the claim time longer. It was I who challenged the ridiculous claim refusal!

If you have not had the medical before taking out the insurance, you are probably heading for trouble. Potentially, BIG trouble. The term pre-existing condition is a catch all and you possibly won’t be able to check what evidence they CLAIM to have.

A MAJOR problem is that the cover you have imagined you had cannot be tested until a claim is made. It is only then, and most likely many years after the insurance cover was taken out, that you will be able to determine if the cover was/is worthwhile. After you have been paying for the 'cover' all those years. Like all insurance, hopefully a claim will never be necessary. I had alluded to a parachute: it is a bit late to need the 'chute, pull the cord and only then discover that the 'chute is full of holes.

Even with consultants, doctors and other specialists involved you will probably get nowhere. Pre-existing conditions. Associated symptoms... and on it goes. Nowhere.

If you can afford it, get a solicitor. I couldn’t and the length of the challenge would have made it very expensive. I prosecuted my own case. I had no alternative. Another reason why settling would possibly never happen. The claimant will die or the process will get too expensive to proceed. If you need the help of other people because you are in no position to prosecute your own case - you are after all critically ill by definition by this time - it is less likely these other people would have the energy or determination and would probably give up. They couldn’t be blamed as it’s a very difficult road to tread. Remember, if you are critically ill then you are a very vulnerable person and it is likely you cannot defend yourself. It would make you an easy target to just write-off and ignore. That’s how I came to understand the ‘game’ they play: attrition. There is no rulebook. Wear the claimant down.

It’s so clear in hindsight, but at the time I was too busy fighting, it seems, with just about everyone in my attempts to stay alive. This is critical illness.

I was still working full-time. Trying to keep my family together. Myself together. Pay for the mortgage. In one sense, all the pressures ironically seemed to take my mind off my predicament. That’s really bizarre. I know what depression is, but interestingly it was only afterwards did I realise I had been depressed! It’s awful. Operating on two different levels simultaneously: the detached professional and the mixed emotions of a damaged soul. That, I think, can be a real danger of depression. Being unaware of it. Your mental state. A downside of being positive is that the illusion is that you are dealing with your problem and it is not a problem. Working at under full potential and apparently no good reason for it. Penalties there! Outwardly everything is fine when actually it is quite the opposite. But to stay positive. To not crack asunder. Hold it all together. Consider the ‘duck syndrome’: on the surface movement is fluid and smooth. But under the surface, absolute chaos prevails.

I must state that all the medical personnel involved in helping me were very supportive. In fact, by overturning and totally ignoring consultants, Abbey Life was very offensive by definition. That’s the attitude: hard-nosed. The hard-nosed Abbey Life just sat back and did nothing except to continue taking premiums from me. By the way this was linked to an endowment on my house. My family’s future was at stake here, maybe without me.

The General Medical Council: forget it. Absolutely useless and in my view totally discredited. Too busy protecting the very doctor that is possibly culpable. I never got past one particular highly objectionable individual. Blocking my path. This 'office' appeared to be the nerve centre of operations. And as one of its questionable and more sinister functions: to stop people like me from disturbing the peace of the GMC.

The Financial Services Authority: no help whatsoever. However, not related to this current description, the FSA has fined Abbey Life Assurance Company Limited ("Abbey Life") £1,000,000 (in 2002) for breaches in Personal Investment Authority rules [See paragraph 2: REASONS FOR THE PENALTY].

Personal Investment Authority: (now The Financial Services Authority since it was subsumed in 2001) even though this issue raises concerns about a company that deals with this area of business, this organisation did not get involved. On the FSA website it defines critical illness insurance as:

"Pays out a lump sum if you're diagnosed with a critical illness, such as cancer, a stroke, MS, a major organ transplant, coronary artery bypass, heart attack and kidney failure. You can use the payout to pay for medical treatment, pay off your mortgage or anything else."

Definitions are not the problem, but the cynical interpretation of these definitions. The overiding aim is simply avoiding payment. Maximise in and minimise out. It's all consistent with the structure of greed and ignoring 'fair play'. My experience demonstrates this. Very clearly.

Office of Fair Trading: at the time the OFT was showing an interest in the whole area of critical illness insurance. The OFT did demonstrate an interest, but nothing came of it.

The Association of British Insurers: forget it. Worse than useless, if that's possible. They have only the interests of the insurance industry at heart. Not yours or mine. This organisation turned out to be a shop window for advertising the industry. A dog without teeth.

Since January 2002, this has been amended. Before this time, the investment arm of the Ombusdan service dealt with such medical matters (disastrous). Now, a specialist group has taken over. No comment about this can be made as there is no updated personal experience. However,

BE EXTREMELY CAREFUL


According to The Association of British Insurers

  • Disputes about critical illness cover are now handled by the insurance division's medical team, not by the investment division of the ombudsman service. "Critical illness" is a life-threatening condition, which is generally strictly defined. Most critical illness policies provide for the payment of a lump sum benefit if the policyholder is diagnosed as suffering from one of a number of specified terminal illnesses. The payment of a lump sum during illness rather than on death can provide a significant improvement in lifestyle, helping to alleviate the consequences of infirmity.


  • However, policyholders need to be aware that under many of these policies, claims are only valid if the policyholder survives for 28 days after diagnosis.


  • Critical illness cover is often linked to term life assurance, so the sum assured will be payable on death. It is normally a condition of this type of dual insurance that only one benefit will be paid. The premium payable for critical illness insurance is low compared with the amount of the sum assured - but the cover provided is of a limited nature.


  • The Association of British Insurers has issued a statement of best practice, which includes model forms of policy wording. The statement covers the seven "core" illnesses, but includes terms for over 20 different illnesses. It is up to individual insurers how many of these each policy will cover. Each illness is carefully defined and not all forms of an illness will qualify for benefit.



and on it goes... getting worse. More and more hoops to jump through.

My advice... don't waste your time - it's too nasty.

It will either toughen you up or break you.

A short affair now, of course, as you have to die.


If you have a 'critical illness' you may well (hopefully) survive, though now it seems you must eventually die to qualify. So critical is...

ASK THE QUESTION - HAVE THE INSURER DEFINE IT

critical illness (according to the The Association of British Insurers - see above) has become a terminal illness. The bar has been raised. All the more reason to expect delay after delay to speed you on your way. Very cynical and quite horrible.

The Financial Mail on Sunday started by indicating concern, but later suddenly changed its tune. It smelled of pressure from somewhere. Started running scared. FAST. So, from very interested to ‘don’t touch’.

Lloyds TSB: at the time (1997-1999) Lloyds TSB had been making noises about the acquisition of Abbey Life. Clearly, I had been mistaken at that time: Lloyds TSB Life having dropped the "Abbey" [the description is buried just over halfway way down this (dull) text about the Lloyds TSB Group plc greed culture in the Encyclopedia of Company Histories and in Key Dates] came into being in 1988. This date is significant in the history of critical illness and Abbey Life. Examples of the full name of Lloyds TSB Life is cited in at least two more places: 1st and 2nd. In September 1996, Lloyds Abbey Life became a wholly-owned subsidiary of Lloyds TSB Group. I received a reasonably neutral, though clearly very cynical, acknowledgement from Lloyds TSB since this had already happened 10 years earlier in 1988. I had contacted this group concerning the behaviour of Abbey Life not realising my mistake. Lloyds TSB Life has since taken control of Scottish Widows. This collective banking and insurance group (Lloyds+TSB+Abbey Life+Scottish Widows) still maintains its own corporate identity, but look closely for Lloyds TSB.

Financial Ombusdman Service: difficult and don’t expect much support here. Formerly known as the Insurance Ombudsman Bureau. The Ombudsman route is not as helpful as you might expect. In fact, the woman I dealt with actually torpedoed my case, or at least did her very best to do just that, by the incredibly biased questions she claimed to have asked. She should have been a prosecutor.

However, it now transpires that the critical illness insurance disputes were dealt with by the investment division. Clearly, the task at the time was handled by someone who almost certainly had no idea about medical matters. That's quite an incredible admission and could well have substantial legal implications, especially from plaintiffs whose complaint failed as the result of an unqualified handler.

Today, a "medical team" is allegedly involved. Sounds promising, but I am not in a position to comment on that though if you do get here quote: IOB 98/50285 if it hasn't been lost in the reorganisation.

When the IOB (FOS) route possibly fails, try to get your MP to help. In my opinion, support from this quarter cannot be overestimated and in my case broke through the absolute intransigence as within a short while he was straight to the heart of the matter and ultimately made the difference between case failed and the change to success. My case had failed and was filed as such by the Ombusdman. Abbey Life was obviously informed by the IOB that I had failed in my submission as I received a letter from them letting me know. This totally unnecessary communication from my point of view was obviously the close of business notification and a message of their satisfaction. It was contemptuous. But with no material new fact or any new evidence, it was reviewed though only after my MP had become involved. The impartiality of the IOB was questioned with the suggestion that this dispute could be made public.

The outcome was to reverse the earlier (wrong) decision

FOS and Critical Illness

The first annual report explains amongst other things about how staff (presumably healthy) had to endure more than two years of uncertainty concerning the ombudsman services restructuring. Perhaps this will provide the staff with an insight to the plight of critically ill people who reach the FOS and are still living. Living with uncertainty and dying is a considerably different proposition to just living with uncertainty. This is real suffering.

How is the Financial Ombudsman Service funded? It seems that budgets are approved and come from the FSA. How can this ensure unconditional impartiality? Whoever controls the money is in control. It continues to make me very nervous.

Was Abbey Life pissed off by the reversal? Absolutely. This actually sweetened the victory.

Another very sinister set of events? Letters sent to Abbey Life by recorded delivery went missing. No trace. Just as though they had been intercepted and destroyed. Easily achieved using optical character recognition (OCR) software. At one stage a string of SEVEN letters went missing. SEVEN recorded letters.

This implies collusion. Some connection between Abbey Life and the Royal Mail? I make no claims here, but I did get an odd phone call at my place of work from an individual allegedly from The Royal Mail. How was my place of work known to the Royal Mail? Abbey Life would know. Anyway, police action was deferred although I was close to reporting it all. I didn't though (still) regret NOT taking control.

I did ensure that all the original documents relating to my case were safely stored in a secure environment in case I got burgled. Paranoid? Perhaps. Just playing safe since many odd events had occurred especially in the final few months before:

SUCCESSFUL CLAIM

I recommend Special Delivery: less easy to lose. At every stage of a journey, the letter is signed for by each handler. To it’s delivery address. Note that using recorded delivery is no guarantee of delivery to an addressee. Only to the address. The building or house. NOT an individual. Without SOPs (Standard Operating Procedures) that define how such mail is handled internally once it has been delivered, it is all too easy to just ‘go missing’.

An additional problem even after the claim eventually succeeded (15 months) was that I had been forced to continue my mortgage with my provider. The interest amounted to around £4,500. My claim had succeeded and I had premiums returned to me backdated to the claim date (without any covering letter of explanation). Abbey Life was responsible for my forced mortgage payments and the associated interest from the date the claim should have succeeded. This took another 9 months to resolve and clearly was NOT ex gratia.

Get the written report of the medical examination before you start spending money on ‘cover’. It could otherwise result in accusations of theft of premiums by misrepresentation and ultimately a lot worse as they refuse to settle a valid claim.

I do not go anywhere near Lloyds TSB (in fact I cross the street to avoid the sign. Not really, though perhaps you can understand my sentiment), but ignoring the greed culture, it can get worse: Monsanto.

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