Not upheld: claim declined - terminal illness definition not met; mis-information about policy cover complaint against Royal London Mutual Insurance Society Limited, trading as Scottish Provident

Decision detail

Summary

Mrs M and the late Mr M complained that Scottish Provident unfairly declined their terminal illness claim after Mr M was diagnosed with cancer in September 2024. The policy provided cover for terminal illness meeting the policy definition, which required life expectancy of no more than 12 months and prohibited claims within the final 12 months of the policy term. Mr M was diagnosed just days before the policy entered its final 12 months, and medical evidence showed he received active treatment including chemotherapy and radiotherapy, which would have affected life expectancy calculations. The ombudsman found Scottish Provident's decision to decline the claim was fair and reasonable, as Mr M did not meet the policy definition. Although Scottish Provident had incorrectly told Mrs M the policy only covered death, the ombudsman concluded that earlier notification would not have resulted in a successful claim, and the £150 compensation already paid was reasonable.

The Ombudsman's reasoning

The ombudsman concluded that Scottish Provident's decision to decline the claim was fair and reasonable because Mr M did not meet the policy definition of terminal illness. The policy explicitly required both that the illness be incurable and that life expectancy be no more than 12 months, and prohibited claims within the final 12 months of the policy term. Mr M was diagnosed just days before the policy entered its final 12 months. Medical evidence showed Mr M received active treatment (chemotherapy and radiotherapy) which would have affected his life expectancy calculations, meaning he likely did not meet the 12-month life expectancy criterion at the time of diagnosis. The ombudsman found that even if Mrs M had been given correct information earlier and made a claim sooner, the outcome would likely have been the same because the consultant's evidence regarding treatment and life expectancy would not have differed. The £150 compensation for the incorrect information and processing delays was deemed reasonable.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website