If a consumer complains that the way the insurance cover worked wasn’t adequately explained to them when they applied for the policy, we will ask them for information or evidence as to what they were told at the point of sale – and what information was provided when they agreed to purchase the policy.
For example, defining disability as being incapable of carrying out “any occupation whatsoever” – a definition which sometimes appears in this type of insurance policy – is a very strict test.
So we say that someone who sold a policy like this should have made the consumer fully aware of the definition that they would need to meet, to make a successful claim.
We say the same about the definitions of “activities of daily living” that appear in some insurance policies. Because these definitions limit the insurance cover available, we expect the person who sold the policy to have made the consumer fully aware of these criteria.
The person who sold the insurance should also have explained how the benefit under the policy is calculated – and the limits to the amount of benefit payable under the “limitation of benefit” clause.
