The runaway Story of the Week this week was our report on an ombudsman’s backing of an insurer’s decision not to pay a claim in relation to the death of a policyholder…

Financial Services Complaints Ltd (FSCL) has upheld the decision of an insurer not to pay a claim in relation to the death of a policyholder.

When ‘Sinead’ died, the executor of her will made a claim on her life policy. However, the insurer declined it on the grounds Sinead did not die from an accident that was the sole cause of her death – a key condition of the policy. Following a review of the case, the FSCL agreed with the insurer.

Sinead was taken to hospital after she fell and broke her hip. However, she became increasingly unwell post surgery to the point where she was unresponsive. A scan showed there had been a large bleed in her brain. She died 10 days after the accident with her death certificate recording the cause of death due to:

  • A large brain bleed
  • A bleed in her lungs related to existing cancer
  • A broken hip

Sinead’s daughter, ‘Patricia’, was the executor of her mother’s estate, and submitted an insurance claim for loss of life. The insurer declined the claim saying the primary cause of death was the brain bleed – and so the accident was not the sole cause of death. Patricia did not accept the insurer’s decision and complained to FSCL.

The policy wording was not met, and it was not fair to expect the insurer to pay a claim…

Following a review, FSCL determined that while the broken hip set the scene, the death certificate and the medical expert both referred to a brain bleed as the primary cause of death.

“Sinead had purchased a policy that would compensate her if she was injured in an accident and that injury was the sole cause of death,” states FSCL in its written decision.

“Sinead had paid premiums to the insurer based on this type of cover. The policy wording was not met, and it was not fair to expect the insurer to pay a claim that fell outside the policy wording.

“We decided that Patrica should discontinue her complaint. Patricia did not agree with our decision but did not give us any new information to cause us to reach a different decision.”