Upheld: Travel / life insurance claim disputes complaint against Legal and General Assurance Society Limited

Decision detail

Summary

Mrs O complained that L&G refused to consider a retrospective terminal illness claim on a term assurance policy that expired in February 2023, following Dr O's death from cancer in September 2023. Dr O had been diagnosed with cancer in February 2020, prior to the TI benefit expiry in August 2021. Mrs O first contacted L&G about the claim in October 2023. L&G initially indicated it could consider a retrospective claim but then reversed this position in June 2025, citing policy terms and arguing the claim could not succeed based on Dr O's actual survival beyond three years. The ombudsman upheld the complaint, finding it fair and reasonable for L&G to retrospectively consider the claim, as the diagnosis predated benefit expiry and the contact was made relatively promptly. The ombudsman ordered L&G to consider the claim based on what Dr O's life expectancy would have been assessed as at the relevant time, not based on hindsight, and to pay £500 compensation for service failures.

The Ombudsman's reasoning

The ombudsman found that retrospectively considering terminal illness claims after benefit expiry is something insurers can and do undertake where diagnosis occurred prior to expiry. It is fair and reasonable practice for L&G to do so here because: (1) Mrs O's October 2023 contact was only months after policy expiry and one month after Dr O's death; (2) Dr O received his diagnosis prior to the TI benefit expiry in August 2021; (3) Dr and Mrs O were likely going through a difficult time and making a TI claim may not have been at the forefront of their minds; (4) there is no evidence that the delay has prejudiced L&G's position; (5) L&G's position that the claim would likely fail is based on hindsight knowledge of Dr O's survival, not on what his life expectancy would have been assessed as at the relevant time (prior to August 2021). The ombudsman rejected L&G's argument that considering the claim would unfairly prolong matters and give false hope, noting that L&G itself prolonged matters by initially saying it would consider the claim then reversing that position.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website