CommInsure under scrutiny – AFRM’s view
CommInsure are in full damage control after this weeks Four Corners program exposed some very concerning practices. In essence, it is alleged that CommInsure goes out of their way to find reasons not to pay claims. We feel we should respond to this.
The report discusses the experience of James Kessel, a 46 year old Diesel Mechanic from Northern NSW. In September 2014, James suffered a Heart Attack soon after arriving at work. His colleagues got him to the hospital where it took a defibrillator to get his heart going. According to one nurse treating him, “you’re the luckiest bloke we know”.
James had a CommInsure trauma contract for $1.1M. CommInsure denied his claim, instead offering him $25,000 partial payment under the “heart surgery” conditions (James had a stent inserted). The reason for denying the claim – James did not meet the specific definition of “heart attack” contained in his policy.
Hearing James’s story draws several immediate reactions from us:
Firstly, James did not have an adviser assisting him with his claim. CommInsure’s response has essentially been that they made a “mistake”. Who knows? Our view is that if this was an AFRM client we have every confidence that we would have ensured the full claim was paid. We have a thorough knowledge of claims processes and the workings of insurance contracts and their definitions.
AFRM passionately believes that the role of any true life insurance adviser does not end with the policy being issued. Our job is to assist clients in their time of need and to passionately manage claims on their behalf. We find it difficult to highlight how valuable this service is. Understanding the claims process and the policy requirements is essential to the claim outcome. Indeed, one of our advisers was delighted to receive this email today from a client:
“Watching this weeks 4 Corners episode on CommInsure has reminded me of how important your help was when claiming on my CommInsure Trauma Insurance policy. Thank you again!!!”
A second takeaway from this case is the importance of understanding that definitions differ and they matter. In short, this was a relatively old policy and the definition may not have been as flexible as others in the market. There is a need to constantly review policies to ensure that the definitions give you the highest opportunity to make a successful claim.
The final key takeaway for us is the importance of placing cover with an insurer who has demonstrated a sound claims payment philosophy. AFRM has close relationships with our preferred insurers. We know the people we will be dealing with when we manage a claim for our clients. We know that they have a willingness to treat our clients fairly and to do what is right. CommInsure is not one of our preferred insurers, but on occasions may be the most appropriate choice to meet a client’s needs for a variety of reasons including: occupation; medical; or other issues that may preclude obtaining new cover elsewhere.
For our clients with CommInsure polices, we have contacted them to assure them that we are here to protect their interests and take the stress out of the claims process for them should the need ever arise.Please note, this information has been prepared by Australian Financial Risk Management Pty Ltd (AFRM) ABN 21 001 696 868. AFRM hold an Australian Financial Services License (AFSL) 237186. The information is for general purposes only and has been prepared without taking account of your objectives, financial situation or needs. AFRM recommends that you seek professional advice before acting on any information contained herein.