Not upheld: unfair claim decline complaint against Canada Life Limited

Decision detail

Summary

Miss C claimed on her group income protection insurance policy after becoming unable to work due to illness. Canada Life declined the claim, concluding that Miss C did not meet the policy definition of incapacity, which requires objective medical evidence that illness prevents performance of material and substantial job duties. Miss C appealed and complained to the FOS, arguing the medical evidence had not been properly considered and providing additional information. The ombudsman found Canada Life's decision was not unfair, as the available medical evidence did not clearly establish that Miss C could not perform her job duties with adjustments, and she had reported improvements during the deferred period without requiring specialist care. The complaint was not upheld, though the ombudsman agreed that £300 compensation for complaint handling delay was reasonable.

The Ombudsman's reasoning

The ombudsman applied the policy definition of incapacity, which requires that illness or injury prevents the member from performing the material and substantial duties of their normal occupation, supported by objective medical evidence. The ombudsman found that although Miss C was suffering from symptoms and was signed off work by her GP, the medical evidence did not clearly establish that she could not perform her job duties with adjustments. The fact that Miss C reported improvements during the deferred period, had not required specialist or psychiatric attention, and had sufficient time to settle on medication supported Canada Life's conclusion that she did not meet the definition of incapacity. The ombudsman noted that Miss C's additional medical information could not be considered as it had not been provided to Canada Life at the time of the decision.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website