OBS 2023 Report Website

Media Release – 18/07/2024

Reporting on the 2023 Annual Report for the Ombudsman of Banking Services (OBS), former Banking Ombudsman Reana Steyn,  reflected on the past 23 years of the office’s existence.

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Media Release – 28/06/2024

The Ombudsman for Long-term Insurance (OLTI) and the Ombudsman for Short-term Insurance (OSTI) have published their last joint annual report for 2023, as they have now been incorporated into the National Financial Ombud Scheme South Africa (NFO).

J29655_NFO_June Web Banner_(1200x800px)_Beware of Reposessions

Media Release – 19/06/2024

South African consumers across the board find themselves increasingly under pressure due to the high cost of living and other factors outside their control, such as the increasing food and petrol prices, with most of their budget going towards essentials.

24-06-04_J29109_NFO_Web Thumbnail_(1200x800px)_Nerosha Maseti

Media Release – 03/06/2024

The National Financial Ombud Scheme (NFO) today confirmed the appointment of Nerosha Maseti as Lead Ombud of the Banking Division. “Nerosha brings over 18 years of Banking Ombudsman experience to her new role. She has proven abilities as a leader and in all aspects of Ombud operations, and we are excited to see where she takes the Banking Division going forward…”

CR403 – Pre-existing condition clause in disability benefit

Pre-existing condition clause in disability benefit– time limit on conditions excluded – onus on insurer to prove the pre-existing medical condition existed within the time frame and its causal link to the disability

The complainant was employed by the employer as long-haul truck driver in July 2016. On 1 November 2016 he became a member of the union’s Provident Fund and an insured under the fund’s group risk policy.

A claim for disability benefits was submitted to the insurer in February 2018 following the complainant being declared unfit to work as a result of “anterolisthesis and spondylosis with ischiatic nerve irritation, with referred pain to the left leg associated with weakness”. The date of disability was determined to be 1 July 2017.  The insurer declined the claim because the complainant’s “disability was traceable to a condition of which symptoms (weakness and referred pains in his left leg) were experienced in the six months before his cover started.”

The insurer relied on the medical report dated 6 November 2017 in which the doctor stated: “(The claimant) was involved in a train accident 2003 and injured his lower back. He was suffering since 2003 with chronic lower back pains and since 2017 experienced the weakness and referred pains his left leg.”

The policy stipulated that a benefit is not payable if the insured becomes totally disabled within 12 months of commencement of cover if the disability is directly or indirectly traceable to:

  • a bodily injury which occurred, or
  • a condition of which the INSURED was conscious or experienced symptoms for which medical treatment was received during the six MONTHS immediately before the mentioned date.”

We pointed out to the insurer that the complainant’s cover commenced on 1 November 2016.  According to the doctor, the symptoms referred to (weakness and referred pains in his left leg) only commenced in 2017.  The history of consultations shows the first date of consultation as 8 March 2017.  This appeared to be corroborated by the report of another doctor dated 10 July 2017, which states that the patient reported a 5-month history of worsening lower back pain.

We also pointed out that a “Road Traffic Act” medical report was completed on 23 June 2016, seemingly as part of the requirements to obtain a driver licence to drive a heavy duty vehicle, wherein the question of whether the complainant, to the best of the doctor’s knowledge, suffered from any condition causing muscular incoordination, was answered in the negative, and the complainant was given a clean bill of health for the purposes of driving a heavy duty vehicle.

Whilst we acknowledged that the insured suffered a back injury in a train accident in

2003, seemingly to the lower back, we were not convinced that the insurer had discharged the onus of proving that in the six months prior to commencement the insured had a condition of which he was conscious or experienced symptoms for which medical treatment was received.  We did not think a broad statement “since

2003 chronic lower back pain” was sufficient to prove on a balance of probabilities that the condition (of chronic lower back pain) occurred in the six months prior to the commencement or that the insured was conscious of the condition in those six months.   We therefore asked the insurer if there was any medical or other evidence specifically pertaining to the six months prior to the commencement to support their contention that the insured had a pre-existing condition as described in the “pre-existing condition” clause.

In response, the insurer decided to admit the claim and the benefit of R267 562 was paid to the fund, for the benefit of the complainant.

This case demonstrates that an insurer has to provide the medical evidence required to prove, on a balance of probabilities, the pre-existing medical condition and its causal link to the claim event.

CR402 – Compensation – poor service – putting complainant to unnecessary effort


The deceased had a policy which provided cover in the event of accidental hospitalization.  The deceased had been hospitalized for an extended period from 16 June 2016 to 18 August 2016.  The complainant who is the deceased’s son, phoned the insurer to enquire whether he could claim under the policy.  The complainant advised the call center consultant that the insured was hospitalized for difficulty with breathing.  The complainant was given a claim number and had to obtain claim information.  The call center consultant did not inform him that this was only an accident policy.

The following claim requirements were sent to the complainant via e-mail:

  • identity document
  • detailed hospital account
  • confirmation of bank details
  • discharge summary report
  • motivation letter from doctor explaining why it was necessary to be hospitalized for more than 3 days.

The complainant had to incur costs and had trouble obtaining this information, which he submitted to the insurer on 22 September 2016.  He then followed up with the insurer on 11 October 2016.

On 17 October 2016 the insurer advised him that the claim was declined as the policy only covers:

  • bone fractures
  • second degree burns
  • dislocation requiring surgery


We raised the following with the insurer:

  • why did the call center consultant not inform the complainant that the policy only provided cover in the event of an accident?
  • why could the author of the e-mail message listing the claim requirements also not do so?

The insurer informed us that the relevant staff members could not give advice and therefore could not advise the complainant on the outcome of the claim.


Although the complaint could not be upheld, the insurer agreed to pay compensation amounting to R5 000.00 for putting the complainant to unnecessary trouble and inconvenience to provide documentation in a claim that could never succeed.

CR401 – Repudiation of a dread disease claim – non-disclosure of material fact


The complainant applied for life cover to the insurer in July 2007.  During August 2013 she added additional benefits, inter alia a dread disease benefit to the policy.  In March 2016 she increased the dread disease cover and in her application form to increase the benefit, she answered in the negative to all of the following questions:-

“a) Since completing the medical questions on your existing policy application, have you been diagnosed with any disease(s) or disorder(s) that requires ongoing or intermittent management (medication, monitoring or other treatment(s))?

  1. Have you had or are you scheduled for any medical investigations or examinations in the next eight weeks, for example x-rays, scans, biopsies or other surgical procedure, blood investigation or specialist assessments?

  1. Are there any circumstances that may have arisen since the last disclosure you have made for this policy, which may affect the assessment of risk for the cover or benefits you are applying for in this application form? You have to tell us again of any health circumstances that you have disclosed in your original application form…”

Since no adverse medical information was provided in the application form to increase the benefit, the dread disease benefit was increased.

On 10 May 2016 the complainant submitted a dread disease claim to the insurer after being diagnosed with breast cancer.  On investigation of her claim, the insurer established that on 19 June 2013 the complainant underwent test to determine the presence of the BRCA2 gene.  A pathology report dated 03 September 2014, received by the insurer at claim stage, confirmed a sequence variance in the BRCA2 gene.  On 07 March 2016 the complainant consulted a general surgeon “with the intention of discussing a possible risk prevention plan to be pro-active against the BRCA2 risk.”

The insurer declined the claim in respect of the increased portion of the dread disease benefit.

The complainant approached our office for relief and alleged that “In a totally unrelated exercise, I consulted a surgeon, Dr A, on 7 March 2016 with the intention of discussing a possible risk prevention plan to be pro-active against the BRCA2 risk.  The BRCA2 statistics prove average cumulative risks by age 70 years are 45% for breast cancer and 11% for ovarian cancer. The risk of contracting breast cancer at my age was therefore being placed on par with other woman same age bracket. In the medical profession it was considered ‘radical’ to get a prophylactic double mastectomy as well as ovary removal. At such stage neither I nor the doctor was concerned about having cancer as all previous test results were clear and I was given time to think about the options.

On 18 April 2016 Dr A attended to a core needle biopsy and on the said date only was it discovered that I had breast carcinoma.

I pause to point out that the service alteration request was attended to and completed on 23 March 2016, and thus nearly a month prior to having been advised of the breast carcinoma. I therefore could not possibly in fact have any knowledge of the condition during the service alteration request of 23 March 2016 and have duly, properly and honestly answered all requested information;

I had at the time of completion of the request also not been diagnosed with any disease or disorder which requires on going treatment nor was any medical investigations or examination scheduled. The consultation with Dr A of 7 March 2016 was simply for advice on a prevention plan – which was still deemed ‘radical’ in South Africa.”

The insurer responded as follows to the above:

“…Dr. A confirms the Complainants awareness of the risk that the BRCA gene carried by her enquiry as to the necessity of undergoing a bilateral prophylactic mastectomy. In the face of the clear questions in the (application form to increase the benefit) she should have told us of this.

We submit that her consultation with Dr A (which was impelled by her concern for her carrier status) was a circumstance that in the estimation of the reasonable and prudent person was apt to be disclosed.”


Since an insurance contract is one of good faith, a life assurer, in order to assess the risk, relies almost exclusively on the information provided by the proposer when applying for the insurance.  The proposer is therefore duty bound to voluntarily disclose all material information relevant to the risk that is to be underwritten.  The strict requirement for full and honest disclosure is a fundamental principle of insurance.

It is probable that, had the complainant made full disclosure of her consultation with the general surgeon on 07 March 2016, the insurer would have requested further information before taking a decision as to whether the benefit should be increased.

Our office made a preliminary ruling that there were no legal or equitable grounds on which the insurer could be requested to make any concessions to the complainant.


The complaint could not be upheld.

CR400 – Interpretation – activities of daily living cover

Interpretation – activities of daily living cover – payable only if full time caregiver is required – meaning of ‘full time’


The complainant, a housewife, submitted a claim under the activities of daily work benefit after being diagnosed with chronic urinary retention as a result of bladder outlet obstruction with bilateral pyelonephritis.  She needs to perform clean intermittent self-catheterization every two to three hours.

To qualify for a claim in respect of the benefit, the complainant would, inter alia, have to comply with the following: “The claimant requires full time nursing care or a caregiver as a result of his/her medical condition.”

In her submission to our office the complainant explained as follows:

“My husband and youngest daughter are educators.  They return home daily at 3pm and relieve the helper (3 days in a week).

The days that I cannot afford a helper my niece takes care of me (2 days in a week).

On weekends my eldest daughter and husband who lives with me takes care of me (2 days).”

The following is an extract from a medical report submitted:

“The patient … finds that treatment with clean intermittent self-catheterization is very difficult and requires permanent assistance.  She needs to perform clean intermittent self-catheterization every two to three hours.”

The insurer declined her claim, as she “partially needs a caregiver to help catheterise, however does not require full time care.”


Our office wrote to the insurer and expressed the view that the meaning to be given to “full time” must be reasonable.  So, for example, it would be unreasonable to contend that “full time” means every second of the day.

Rather, a reasonable interpretation is to say that if a person requires nursing care or a caregiver to assist her on an ongoing basis for a very significant part of her day, then that would constitute “full time” case for the purposes of the policy.

The insurer did not agree with our view.  However, a meeting of the office’s adjudicators was unanimously of the view that the criteria had been met.


A provisional ruling in favour of the complainant was therefore made which the insurer accepted.

CR399 – Poor service – fairness – compensation


  1. The complainant advised that he transferred a large sum of money to the insurer on a Thursday. He visited a branch of the insurer’s on the same day and was advised that his timing would allow him to purchase units at the “ruling price / rate of the day”, thus the unit price determined on Thursday.
  2. The insurer acknowledged the advice given to the complainant by its consultant, but stated that the advice was unfortunately not correct. Whilst the complainant’s investment was processed on the Thursday before 14h00, the units were purchased the next day (Friday) at a price that was determined at the close of that day (Friday), which was higher than the preceding day.
  3. The insurer referred to the policy, which provides that if the instruction is received before the cut off time of 14h00 and all requirements are met, the instruction will be processed on that business day and the client will receive the unit price of the following business day. In other words, if all the requirements were met by 14h00 on Thursday, the units would only be purchased on Friday.
  4. The insurer further advised that the unit price for a certain day is only determined at the end of business of that day.
  5. The insurer was of the view that the complainant was not treated unfairly, as his investment was processed in the same manner as all other clients who submitted an instruction prior to 14h00 on Thursday.


  1. With regards to the complainant’s request for the insurer to honour the unit price as at Thursday, the office considered its Rule 1.2.4 that states that we must accord due weight to considerations of equity.
  2. However, we found that it would not be fair to require the insurer to provide the complainant with the number of additional units which the complainant’s investment would have purchased at the lower closing unit price as at Thursday. It thus follows that there is no equitable reason why the insurer should pay the money value of the additional units.
  3. The complainant’s claim was dismissed.


  1. In terms of our Rule 3.2.5, this office may award compensation, irrespective of the outcome of the complaint, for material inconvenience, distress or for financial loss suffered by a complainant as a result of the insurer’s error, omission or maladministration.
  2. The insurer unequivocally apologised to the complainant for misinforming him of the processing timeline and offered compensation of R2 000.00.


The complainant accepted the insurer’s offer and the matter was closed.