better banking

Case - 50623

2016 - 2017


Health insurance

Mr J’s insurance policy with his bank provided income cover for total disablement through injury or illness, as well as a crisis cover benefit if diagnosed with one of a list of critical medical conditions. 

Mr J’s work was physically demanding, and when he experienced back pain, his doctor prescribed anti-inflammatory pills for a back strain. Mr J was also referred to a physiotherapist, who gave him back exercises to do. The physiotherapist considered Mr J had sustained a gradual onset work injury for which he should be entitled to ACC, and communicated that opinion to Mr J’s doctor. 

The doctor rang Mr J and said her view was that ACC would not accept a claim. Mr J replied that he was feeling much better and was not taking the prescribed pills. 

Mr J went back to work, but he continued to experience back pain for the next two months. He suffered a further back injury at work, and was sent home. Three weeks later, having still not returned to work, his employment was terminated.

Two months later, Mr J submitted a claim for income cover, saying his back injury prevented him from working. The bank was sent his doctor’s notes for the visit and follow-up call. The bank said Mr J did not meet the policy definition of total disability, and also there was nothing to show he had left work because of a medical condition. 

Mr J disputed the bank’s decision, and the bank reviewed it. Mr J supplied information about his employment, but it contained no mention of any medical problems.

The bank confirmed its original decision. At this point, Mr J was overseas, but soon afterwards he submitted a claim for crisis cover, saying he was suffering from kidney failure, one of the critical conditions set out in his policy. He enclosed copies of medical documents in another language. The bank said it was prepared to consider his claim, and asked him to provide translated copies, as well as more information about his condition. 

Mr J replied that the documents were sufficient for the bank to approve his claim for crisis cover. The bank disagreed, and Mr J complained to us about the bank’s decision to decline his claims for both benefits.

In considering a complaint about a disability benefit, we assess, firstly, whether the individual has established a prima facie case for receiving the benefit, and secondly, whether the insurer’s decision to decline the claim was reasonable.

In looking at the first issue, Mr J had to prove:

  • he was suffering from a disability caused by an injury
  • he needed and was receiving regular medical attention
  • he could not work more than 10 hours a week in his usual job because of the injury. 

The medical information showed Mr J had suffered back strain, which had improved with anti-inflammatory pills and physiotherapy. Mr J could not show he required and was getting regular medical help. He visited his doctor once only and did not see the physiotherapist again after the first visit. And nothing in the medical information showed his back strain prevented him from working more than 10 hours a week in his usual occupation. 

Mr J argued the bank should have accepted his word about his level of disability. Alternatively, he said, it had to prove he was not suffering the claimed level of disability. However, we explained that the onus was on him to establish a claim to the benefit, and we considered he had not done that. It was unnecessary, therefore, to consider whether the bank’s decision to decline the claim was reasonable.

As to his claim for crisis cover, Mr J had to be diagnosed as suffering from end-stage renal failure, that is, chronic failure of both kidneys, necessitating permanent dialysis or a kidney transplant.

The foreign language documents he gave the bank were blood test results. Mr J considered these documents sufficient to establish end-stage renal failure. We did not. The documents showed he had had some blood tests overseas, but they did not show he had been given a diagnosis of end-stage renal failure. The bank gave him opportunities to provide more information, but Mr J declined to do so. 

We did not consider he had established a prima facie claim, nor did we consider the bank unreasonable to seek translations of the information, as well as more information on his medical condition. 

Mr J did not accept our view. We reviewed the information and confirmed our initial finding.