Ask A Lawyer: Critical Illnesses and Insurance Claims

Ask A Lawyer: Critical Illnesses and Insurance Claims

Q: What if I have a diagnosis of cancer and the insurance company says it’s not the right type of cancer?
A: The wording of the policy must be reviewed carefully to determine whether the type of cancer that has been diagnosed meets the criteria for a critical illness payout. The law states that, if the policy wording is unclear, the proper interpretation would be to decide in favour of the claimant rather than the insurance company, as they drafted the wording.

Q: What factors do the insurance companies use to determine if I am eligible to receive critical illness benefits?
A: Under most policies, a critical illness is one that results in the loss of independence. Cancer, stroke, heart attack, heart surgery, kidney failure, organ transplantation, brain tumour, paralysis, coma, permanent disability, Alzheimer’s, parkinson’s diseases, and multiple sclerosis may qualify you. Check with your critical illness insurance lawyer to help identify the specific provisions of your contract.

Q: Can an insurance company deny a claim based on “material misrepresentation” if the health issue being contested is not related to the illness or injury that has prompted the claim for benefits?
A: Yes. People often believe that if, for example, they have been diagnosed with a form of cancer, but the alleged misrepresentation is regarding high blood pressure, that those two items seem to be unrelated and the misrepresentation appears to be irrelevant. Claims denied based on material misrepresentation turn on the question of, firstly, whether the answer to the question was inaccurate, and secondly, whether the disclosure of the prior medical condition would have been “material” to the insurance company’s decision to issue the policy. If in doubt, contact an experienced insurance lawyer for further guidance and advice.

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