By
Maria Shaw
The challenges of accessing insurance in difficult times
I was interested to read Dr Ranjana Srivastava’s article in The Guardian and the ASIC review into life insurance claims. The article is a heartfelt letter to a deceased man, whose mourning wife has struggled to successfully claim her husband’s life insurance after he died.
This article really struck a chord with the team here at Cancer Council as sadly this happens more than people think, and it’s often during what is already an extremely stressful and emotional time for patients and their families.
Dr Srivastava comments that the ASIC report found extensive delays in processing claims accompanied by poor customer support during a period when terminally ill patients have neither the time nor the energy to pursue a claim – making this another burden for the carer.
Accessing funds at a time when you need to focus on your health is complex, and indeed comes with additional, unnecessary stress. The financial impact also means that patients and their families often need additional sources of money, and for many, making an insurance claim is an option to access these much needed funds.
We see many cancer patients who require extended time off work, while at the same time facing increased medical bills and other expenses. When the primary income earner is unable to work due to a diagnosis or if they are caring for someone affected by cancer, it can mean a loss of $50,000 or even $100,000 per year, which can have catastrophic consequences on a family’s ability to repay mortgage, credit card debts and medical expenses. In the worst circumstances, people can be faced with foreclosure of their home or even bankruptcy during these difficult times.
We also know that claiming insurance can be complicated, as it all depends on an individual’s circumstances.
A lot of people aren’t clear on what exactly is covered in their insurance policy. For example, some super funds include life insurance as part of their default policy and other patients find they have two types of insurance with two different insurers such as trauma insurance, income protection, total and permanent disability (TPD) or life insurance. With so many different types of insurance out there, it’s hard to know which type cancer patients are able to apply for.
That’s when things can start to get complicated, leaving patients and carers confused and overwhelmed. Sometimes a person will be able to access their preserved superannuation under terminal illness grounds as they have less than 24 months to live but they won’t be able to access their life insurance (which could be hundreds of thousands of dollars more) because they have over 12 months to live. Accessing super early may mean that a later claim cannot be made on the life insurance policy so it is important to get the right advice when considering a claim. Sometimes we hear that policies themselves can be tricky to interpret. Insurance claims can hinge on unfair technicalities. We assisted a women whose claim was denied because her tumour was on her brain, rather than in her brain, as was required by her policy.
As Dr Srivastava indicated in her article, the paperwork that comes with accessing insurance can be exhausting – particularly at a time when you may be dealing with the effects of medication and the emotional turmoil of your diagnosis. A financial adviser or a lawyer will be able to assist with this. The services we offer in Cancer Council’s Pro Bono Program are just one way we can help make things a little easier for patients and those around them, during an already difficult time.
Our Program can put people affected by cancer – people like Dr Srivastava’s patient – in touch with financial planners and lawyers, who can assist with accessing superannuation and insurance among other services.
For example, we recently referred a man to a financial adviser as he was unable to claim the life insurance attached to his superannuation because his doctor couldn’t certify that the man had less than 12 months to live (which is one of the requirements for accessing life insurance early). The financial planner advised the man that he should try to access his TPD insurance – this is the insurance Dr Srivastava described as “the most exasperating of them all”, and the one that had the highest decline rates, as per ASIC’s report. The financial adviser submitted the application forms, expedited the claim and the man is thrilled to have now received a payout, particularly when he only had a small sum preserved in his superannuation.
The Cancer Council Pro Bono Program aims to relieve financial burden, provide some respite from the issue and contribute to people’s well-being by reducing stress and allowing them to focus on their health. Since the Program’s inception in 2010, we have received requests to assist over 14,500 people – 7,500 of these were assisted with financial issues, including early access to superannuation and advice surrounding insurance policies. We have also received referrals for 160 people requiring advice in relation to insurance disputes.
Anybody in financial distress or wishing to learn more about Cancer Council Pro Bono services should contact Cancer Council 13 11 20 Information and Support.
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