Monday, December 27, 2010

Unfair rejection of Shield claim

Here is another case of an unfair rejection of a shield claim. The rejection was based on a medical condition that occurred 5 year previously and was not of a long term nature. The agent had advised the consumer that it was not necessary to declare this condition. The consumer was insured with another company previously but made this change after getting the assurance of the agent.

My view
The agent is greedy to make a few dollars of commission on the Shield plan. The agent had harmed the consumer considerably through this irresponsible behavior.


Wilfred said...

Why go after Company B when the principle of utmost good faith has been breached?

The consumer should take legal action against the agent and get the agent to pay for all medical expenses incurred as the agent did the wrong thing by twisting a policy knowingly it is detrimental.

Spur said...

Moral of the story is not to upgrade or change your Shield plan especially if you're above 40, even with the same insurer. You never know what minor ailment they will use to deny your claims. I've already said simple matter like backache or sinuses the insurers will exclude many claims. If you go to polyclinic or hospital, the insurers will know what happen to you before, even if you never claim insurance before. The insurers in S'pore have access to your polyclinic, hospital and other insurance records.

As for consumer protection and justice, this is the problem in S'pore. IT'S YOUR OWN PROBLEM! You need to spend big bucks to fight such a case in court. You need to get private investigator to track down the insurance agent in order to serve court orders on him. You need to spend at least $10K or $20K for such a "you said I said" kind of cases. 99% of agents do not have professional indemnity insurance, so they will definitely run-road. Even if tracked down they will deny to high heaven on the souls of their parents. The agent will say he already advised all the necessary to the client, and the client insisted he is 100% healthy blah blah. So it boils down to which lawyer can be the more persuasive and the mood of the judge etc.

Tan Kin Lian said...

Why should the consumer have to incur the expenses and hassle of taking legal action? It is irresponsible of company B to allow this type of complaint to remain unresolved. If the insurance agent and the insurance company cannot be trusted, what is the purpose of insurance? To give peace of mind or to create uncertainty and stress?

Vincent Sear said...

If a client wants to upgrade his health insurance, e.g. he's earning more income now and would like higher class if he's hospitalised, he should apply for upgrade with the same insurer.

If he feels that another insurer offers policy with better value for premium, he may opt to to switch over if he also feels the savings worth the hassle.

However, if there's a medical condition that has developed subsequent to his original policy inception, it's certainly not advisable to try to switch insurers for whether better value or higher coverage. In the original policy, the condition is not pre-existing. In a new policy, it'll be classified pre-existing, whether he declares it or not (unless there's really no clinical and hospitalisation records), and claim rejected when found out.

zhummmeng said...

The problem is it is NOT the policyholders who initiate change or upgrade but the agents or predatory agents of another company. Policyholders are clueless about the 'latest' or what is good or better.
The policyholders are 'hunted' wherever they go, the banks, the post office, the malls, mrt etc. This is the risk if they are not wary.

Vincent Sear said...

Health insurance in details is quite complicated for clients to understand fully. Some, if not most, agents don't understand fully too. There're itemised limits, annual limits, per event limits, policy life limits etc. on top of deductibles and co-insurance. It's easy for an agent to gloss through the benefits with a prospect without the prospect being able to ask the correct questions or understanding whether the agent is giving the correct answers. So yes, many agents, intentionally or unintentionally, are prone and tempted to misleading clients with half-truths to close the case quicker.

And I agree with Zhummmeng on this, many agents would even resort to "advising" the client to under-declare so that the case can be underwritten and closed quicker. Prospects and clients should have antennae for such unscrupulous and irresponsible agents. Buying insurance is not about saving premium. It's about a fair claim when an event happens.

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