Banks are under no obligation to ensure customers have life insurance before giving them a home loan. We discovered Oscar had applied for life insurance when he sought the home loan, but the bank declined his application because of his medical history. A copy of the letter the bank sent to Oscar, declining his application, was on file. Even if he had not received that letter, we found the bank could not be responsible for his belief that he had insurance: the application form made clear it was an application only and subject to approval, and he had never paid life insurance premiums or received any correspondence suggesting the existence of a life insurance policy after applying for it. Also, a subsequent diary note about his home loan recorded a discussion between Oscar and the bank about his inability to get life insurance because of his medical history.
We did not uphold Bronwyn’s complaint.Print this page