The complainant submitted a claim under his medical gap cover following a hospital stay. The claim was authorised by the insurer. However, the settlement offer was limited. In accordance with the policy terms and conditions, said the insurer, the settlement of a claim for a hospital stay will be limited to the cost of 15 days where it is determined to stem from a chronic illness. The complainant was dissatisfied with the settlement amount offered. The insurer relied on the following provisions in the policy wording:
*7 An annual daily payment limit of 15 days per policy per calendar year is applicable for the chronic illnesses which is defined as follows:
– Any condition where medication should be taken for a period exceeding three months.”
The complainant argued that this limitation was not included in the purchase call or the policy documents at the inception of the policy. According to the complainant, the limitation therefore could not be applied as the insurer has failed to comply with its obligations in terms of the Policyholder Protection Rules. The complainant argued further that the participant incorrectly relied on the limitation because the admission to hospital was for an ear infection and had no connection to his chronic diabetes.
During the validation of the claim, the participant obtained a copy of the complainant’s attending doctor’s note. The complainant’s attending doctor’s note confirmed that the complainant’s ear infection was linked to his diabetes. Additionally, it confirmed that the complainant had been admitted multiple times for a similar treatment at the hospital. Accordingly, while the complainant claimed for a stay of 31 days in a hospital, only 15 days could be covered in accordance with the policy terms and conditions as noted above.
The participant submitted that while the complainant was correct in stating the limitation was not made known to him at the inception of the policy, it was able to supply proof that timeous notice of the amendment to the policy as well as the amended policy documents were sent to the complainant.
The question to be determined was whether the participant’s settlement of the claim was justified as per the provisions of the policy. Furthermore, whether the participant was correct in amending the complainant’s policy after its inception.
The complainant’s attending doctor’s note showed that the ear infection suffered by the complainant during his stay at the hospital was linked to his diabetes. As per the policy terms and conditions, settlement for hospital stays was limited to the cost of 15 days where it was determined to stem from a chronic illness. It was the complainant’s responsibility to familiarise himself with the terms and conditions of the policy at inception and during the operation of the policy.
The NFO was satisfied that the participant had indemnified the complainant correctly in terms of the policy’s provisions. Further, the participant had the option to amend its policy by giving the insured 31 days’ written notice to the insured’s last known address. In this regard, the participant had met its obligation in terms of the Policyholder Protection Rules. As the complainant had not raised any objection to the 31 days’ notice, it was assumed to have been accepted by him. We found that the complainant had been adequately informed of the policy limitation.
Accordingly, the participant’s stance on the claim was upheld.
Nekecia van Niekerk
Adjudicator – Non-life Insurance Division of NFO
