Toronto Injury Lawyer Blog
Critical Illness sounds like a great deal.
If you purchase a Critical Illness Policy of insurance, and you get diagnosed with any of the illnesses identified under the policy, you get paid a great big lump sum of cash.
Depending on the policy and the premiums you get paid, that lump sum could be $100,000; $250,000, $500,000 or even $1,000,000 or greater.
Sounds too good to be true; right?
But beware. Things aren’t always as they appear. When things sound too good to be true, that’s often because they are.
Critical Illness policies are marketed in such a way to seem like they are a safety net should things go wrong. And sometimes, things go really wrong and the policies pay out. But, in my experience, more often than not, insurers find a way to get out of paying benefits.
I call it a bait and switch.
What do I mean by that? Let’s take a look.
Insurers cleverly market these policies as an affordable means to get coverage. They are “living policies”. That means that the recipient of the benefits is generally alive in order to recover benefits. These policies aren’t life insurance. Nor are they disability insurance. One of the triggering events needs to happen, and the person must survive the triggering event.
Those illnesses, or triggering events can be plentiful. They are marketed in a broad based way, like “cancer” is covered. The insurer doesn’t into great detail about the sort of cancer, or the severity or stage of the cancer. They simply market the coverage as for cancer. Or a heart attack. Broad and general terms are first used to lure a customer in. And that luring is very tempting. Cancer and heart attacks are quite common. So, buying insurance to cover such claims makes sense on first review.
Here are a few other common critical illnesses which are marketed to consumers in broad terms:
Cancer
- Cancer of specified severity
Heart Conditions
- Aortic surgery
- Cardiomyopathy
- Coronary artery bypass surgery
- Heart attack
- Heart valve replacement or repair
Neurological Conditions
- Stroke
- Acquired brain injury
- Bacterial meningitis
- Benign brain tumor
- Coma
- Dementia, including Alzheimer’s Disease
- Motor neuron disease (incl. ALS)
- Parkinson’s Disease and specified atypical Parkinsonian disorders
- Paralysis
Autoimmune Conditions
- Aplastic anaemia
- Multiple sclerosis
- Occupational HIV infection
Sensory & Mobility Conditions
- Blindness
- Deafness
- Loss of limbs
- Loss of speech
- Loss of independent existence
- Severe burns
Transplants & Organ-Related Conditions
- Kidney failure
- Major organ transplant
- Major organ failure on waiting list
If you just read all of these conditions, they look fairly common, and appealing to a consumer interested in purchasing Critical Illness insurance. The problem is that simply having one of these conditions isn’t enough.
Under each condition, there is fine print that determines what is required in order to meet these specified conditions. There are specific criteria which need to be met which are rather difficult to understand for a lay person. Often lawyers who have expertise in the area of insurance law, or doctors have solid understandings of how onerous these conditions are to meet.
In addition to having one of these conditions be met, the claimant also must do a lot of the legwork in order to qualify for benefits. The claimants must establish that s/he meets the definition of having sustained a “critical illness”. They simply cannot say that’s the case. They have to show evidence. This means producing clinical notes and records from the hospital, doctors, an ambulance call report, treating specialists and other health care professionals. This will come at a cost to the claimant given that they will need to pay for the processing and production of these records. This is standard. We see this across all sorts of policies, regardless of the insurance carrier. I wouldn’t be discouraged about the up front costs to gathering and producing records. It’s just one of the realities of making an insurance claim across the board.
The troubling thing is what happens if the medical records don’t establish, or are unclear in establishing that the claimant has met the definition of a “critical illness“. This is often the case. When doctors prepare their clinical notes and records, they don’t know that you have a critical illness policy. And if they do, they won’t have that policy in front of them so that they can use specific wording from the policy to address your eligibility. This is why on first view of the records that it’s often difficult for both claimants and insurers to determine if the medico legal definition of critical illness under the policy has been met. This is why many claims are denied at first instance. They may also be denied because the claimant has not supplied sufficient evidence (medical records), in order to substantiate a claim.
What we often see is that insurers will refer the claimant’s file to an expert for a “paper review”. Often, these experts are doctors who are paid by the insurance company in order to assess the merits of a claim. They will determine with their trained eye whether or not there is enough medical evidence there to give an insurer the green light to approve a claim. This is rather tricky, because you have a doctor who is paid by an insurer to review a file. In many cases, these doctors do more work for insurance companies than they do outside of the publicly funded OHIP system. The insurance work is easier and more lucrative. It would be counter productive for one of these doctors to bite from the hand which feeds them and which has become one of the primary sources (if not the primary source) for their workflow. When there is a denial from one of these experts, it’s difficult for a Plaintiff to get approved without new medical evidence supporting their critical illness, or without a rebuttal report from an expert of their own. An optimist would submit that if the Plaintiff submits a bit more medical evidence, or some new medical evidence that the insurance expert will change his/her mind. But what happens if there is not more evidence to submit and the doctor was willfully blind to some evidence which would have supported the claimant’s disability claim? It’s at this moment that the claimant will need an experienced personal injury lawyer to help them out. This sort of situation is all too common.
