Posts in category: Disability

CR383

Disability claim – mineworker – hearing loss

Group scheme claim lodged in 2017 – insured passed fitness examinations and worked on mine for ten years before being declared unfit because of hearing loss – insurer declining claim on basis insured was already unfit for his position when first employed by mine in 2007 – whether insurer declining liability was fair.

Background:

1. The complainant was employed as a miner in 2007 and became a member of the employer group scheme with the insurer.  He passed  fitness examinations and was declared “Fit” to work by the occupational health practitioner every year from 2007 until 2017.  He in fact did work for those ten years. 

2. The complainant had been compensated in terms of the Compensation for Occupational Injuries and Diseases Act (COIDA) for some hearing loss in 2006, when he was working for another employer.  This compensation was based on a percentage disability (PD) of 11%, in turn based on a percentage hearing loss (PHL) of 17% and pure tone average of 27.5 dB (which became the baseline at his entry into the job in 2007).  His hearing remained relatively stable until 2016 when deterioration took place.  An audiology test dated 3 February 2017 confirmed a PHL at that stage of 27%.  At this point, after a 10% shift from baseline, the occupational health practitioner decided to declare him not fit to work, for his own protection against any further hearing loss.  He could not be accommodated in a less noisy setting and sought payment of a disability benefit. 

3. The insurer declined the disability claim.  The insurer stated that according to the minimum standards of fitness to work on a mine issued by the Department of Minerals and Energy, a person aged 40 and above (which the complainant was in 2007) should have a pure tone average of 25 dB or less on audiometric screening.  At 27.5 dB the complainant’s level was already over this limit, and he had even been compensated for hearing loss.  The insurer’s defence was therefore that, at the time when the complainant joined the scheme on employment in 2007, he was in fact already unfit to occupy the position as a miner. 

Discussion:

4. The disability definition in the policy read as follows:

A Member shall be regarded as Disabled and entitled to his Benefit as from the expiry of the Waiting Period if, in the reasonable opinion of Momentum, injury or illness has rendered him totally incapable of engaging in his Own Occupation during the first twenty-four months of disability.

5. A clause in the policy stated: 

For those medical conditions that both impact on the Member’s ability to perform his Own Occupation safely and are governed by the Mine Health and Safety Act of 1996 and the Occupational Health and Safety Act of 1993, the Date of Disablement will be the date that the occupational health practitioner determines the Member’s medical condition to be below the mandatory requirements applicable at that date. [my emphasis]

These conditions include and are limited to:

• Loss of vision
• Loss of hearing
• Epilepsy
• Cardiac function
• Insulin dependent diabetes; and
• Hypertension                  

6. We put it to the insurer that an employee may be compensated more than once in terms of the Compensation for Occupational Injuries and Diseases Act (COIDA), depending on the injury/disease, and the level thereof.  Having been compensated does not in itself mean that an employee is prohibited from working.  Furthermore having been compensated cannot be seen in itself as an indication that the complainant was disabled as defined by the Momentum policy – he clearly was not totally incapable of engaging in his Own Occupation of a miner at that stage, as he did engage in it full-time for the next ten years.

7. We noted that the insurer did not appear to have requested proof of insurability at the time when the complainant became a member, and the insurer accepted premiums in respect of his disability cover for ten years.

8. We suggested that it was not for the insurer to decide after the fact (ten years later) that the complainant’s medical condition had been below the mandatory requirements at the date he commenced employment.    In terms of the policy, it is the occupational health practitioner, not the insurer, who must make the determination as to the date on which the member’s medical condition is below the mandatory requirements.  In this case the occupational health practitioner in fact certified the complainant fit to work in 2007, and each year until 2017, when the occupational health practitioner for the first time determined his medical condition to be below the mandatory requirements.

9. We examined the minimum fitness standards referred to by the insurer.  While the Department of Minerals and Energy Guideline for the Compilation of a Mandatory Code of Practice (“the Guideline”) indicated at clause 8.3.5.2.1 an audiometric standard for a person age 40 and above as “pure tone average of 25 Db  or less”, the same document also indicated at clause 8.4.1 that a discretion was afforded to the occupational health practitioner when determining fitness for work, taking into account such factors as the period of further exposure, the experience of the employee, personal protective equipment, supervision at work, etc.  An example was given at 8.4.1.3: “Where serious, permanent disablement could result, further exposure is undesirable thus eg an employee with more than 60Db average pure tone hearing loss (0,5 kHz, 1,2 and 3 kHz) is not fit to work in a noise zone at a mine”.  We pointed out to the insurer that 60Db pure tone hearing loss was considerably more than that suffered by the complainant. 

10. It was also stated at clause 8.4.1.7 that: “The OMP may consider declaring a person fit to continue working subject to certain conditions such as closer supervision and monitoring which may include reduction in exposure and more frequent medical surveillance”.

11. It was a matter of record that the complainant had been closely monitored by the occupational health practitioner at the mine, regularly received hearing loss counselling, and was compliant with the use of protective devices. 

12. It was also stated in the Guideline at clause 8.3 that “an OMP may apply more or less stringent standards depending on circumstances or risk assessment, at a specific mine.  For specific fitness requirements for job placement consult Annex 1. (Annex 1 must be complied with.)”   We noted that Annexure 1 “Schematic Guideline for Job Placement Evaluation” did not in fact make it clear, in respect of hearing, that a person may not work if they have the pure tone average hearing loss for different ages listed in Annexure 1.  The word “exclude”, employed for other conditions in Annexure 1, was not used in respect of hearing loss.

13. The South African Society of Occupational Medicine Guideline “Audiometry in the Workplace” (2011 Revision) stated at clause 6.11 that “Workers should preferably be removed from the noise area when their PLH is more than 15%, but definitely at more than or equal to 30%”. [my emphasis]  This underlined the use of discretion by the occupational medicine practitioner. 

14. In the context where the occupational medical practitioner had exercised a discretion to declare someone fit to work although he had mild (and compensable) hearing loss in 2007, and to continue to declare him fit annually until his hearing loss deteriorated to such a degree that he no longer considered him fit to work in 2017, we argued that it was unfair for the insurer to deny liability once disability and a date of disability had been determined by the occupational health practitioner to be in 2017, on the basis that the degree of hearing loss fell below a certain standard in 2007.

15. It appeared that it was the insurer’s argument that the employer/ occupational health practitioner should not have allowed the complainant to work, because of the level of his mild hearing loss in 2007.  The implication was that his recourse would thus be against his employer.  We stated that if that was the argument, the result was inequitable.  The complainant would clearly not be in a position to sue his employer for having employed him for the last ten years, and it was fanciful to suppose that the employer would agree to pay him a salary for the next four years now that he was considered disabled, despite having insured itself against such an eventuality. Having rendered service for ten years, with premiums having been paid to cover him for disability, the complainant would in all likelihood, despite being disabled, be without an income for the four years until his retirement date.

16. We stated our view that, taking into account all the factual circumstances and evidence, as well as considerations of equity, the claim should be paid.

Result:

17. The insurer agreed to pay the claim.

CR362
Waiting period / Disability / Equity

Unusual 24 month waiting period for permanent disability; equity invoked

Background

1. The life insured had an accidental death and permanent total disablement policy. He was involved in a motor vehicle accident in March 2015 and suffered head injuries and a consequent stroke. The medical evidence indicated that he was totally and permanently disabled (see below).

2. A claim was submitted in June 2015. The insured’s claim for permanent disablement was declined.

3. In explaining its decision, two policy clauses were cited by the insurer:

“Permanent Total Disablement means total and absolute disablement that entirely prevents an Insured Person from engaging in a gainful occupation of any kind. The diagnosis and determination will be made by a Medical Practitioner. The permanent total disablement must be continuous and permanent for at least 24 (twenty-four) consecutive months from the onset of the disablement.”

and

“CONDITIONS IN RESPECT OF CLAIMS
…
• We will not pay or be liable for any claim:
○ after 24 (twenty-four) months have elapsed from the date of the event that gave rise to a claim”.

4. The insurer then gave its reason for declining the claim:

“The policy provides for a 24 month waiting period for permanent total disablement as defined above. [The insured’s] motor vehicle accident occurred on 4 March 2015. When applying the waiting period, [his] disablement must be continuous and permanent for 24 months from the onset of disablement. The claim cannot be finalised unless [his] permanent total disablement has lasted for 24 months”.

5. The insurer also stated that it was “too soon to make a decision as to whether his injury is deemed permanent total disability”.

Discussion

6. We pointed out to the insurer that there was another relevant clause in the policy:

“We will not pay you:
• For Permanent Total Disablement, unless you submit proof that the disablement will in all probability continue for the remainder of your life”.

7. We also mentioned that the aspect of the definition requiring that permanent total disablement “must be continuous and permanent for at least 24 (twenty-four) months”, effectively a waiting period, was an unusual clause in a policy of this nature. We questioned whether this unusual clause had specifically been brought to the insured’s attention when he took out the insurance.

8. The other clause cited by the insurer (see paragraph 3 above), to the effect that the insurer would not pay any claim after 24 months had elapsed from the date of the event giving rise to a claim, appeared to afford a time period for lodging a claim, and was not relevant at all to this case.

9. We then canvassed the claim forms and medical evidence. The treating doctor had stated on the claim form that the stroke symptoms from which the life insured was suffering (two months after the accident) were left-sided weakness, inco-ordination, reduced reflexes, sensory loss, behavioural disturbance, forgetfulness, mood fluctuations and reduced vision. Asked to provide clinical details indicating severity and permanence, he replied “Continued symptoms as above. Unable to drive, care for himself”. Under “Current major complaints”, he indicated “Urinary frequency, severe lower back pain, falling daily due to imbalance, mood swings”.

10. Under the section on “Disability details”, the doctor indicated that the life insured had not previously followed any occupation other than that of an electrician. The question was then posed: “Is the life insured in your opinion, totally and permanently disabled and unable to follow his/her occupation?” The doctor replied “Yes”. The form continued “If Yes – state reasons and date you advised insured to cease work”. The doctor stated “Danger to himself and others”. The form asked the question “Is the life insured in your opinion, able to follow any other occupation?” The doctor answered “No”. A further question asked “What part of the duties of the life insured’s normal occupation is he/she capable of carrying out?” The doctor responded “Nothing”. A further question asked “Will the life insured at any stage in future be able to follow his/her occupation or a similar occupation?” The doctor replied “No”.

11. Under “Prognosis”, the form asked “What are the chances of recovery (good/fair/poor/nil)?” The doctor underlined the word “poor” and also stated the word “Poor”. Asked whether any residual problems were likely he stated “Yes. Continued weakness; inco-ordination, imbalance”. Under “Function abilities”, the doctor indicated that the life insured effectively could not perform any of the listed activities as he was a “Danger to self or others”, and that this state of affairs would remain constant.

12. In a Medical Certificate signed and dated 19 May 2005, when asked the question on the form “Is permanent disability expected?”, the doctor replied “Yes”, reiterating that the life insured was unable to drive, work, or take care of himself. Asked the direct question “Are you prepared to certify that the patient is TOTALLY DISABLED from attending to any portion of his/her business or occupation?”, the doctor replied “Yes”.

13. From this documentation it appeared that a diagnosis and determination of permanent total disablement (see the definition in paragraph 3 above) had been made by a Medical Practitioner.

14. There was also a rehabilitation discharge report dated 9 April 2015 stating “It is not recommended that [the life insured] returns to working as an electrician at this stage due to his impaired cognition, and that he will “be unable to work effectively as an electrician at this stage” [our emphasis]. The same phrase “at this stage” was used in an August 2015 report from an occupational therapist and physiotherapist (not medical practitioners). We pointed out however that none of these parties was pertinently asked to provide a prognosis. Their reports merely described the current situation, which was why the phrase “at this stage” was used. In our view there was no indication in these reports that the cognitive deficits and other problems would improve to the extent that the life insured would ever be able to return to work. Certainly this was not the view of his medical practitioner.

15. The life insured’s wife had outlined the financial hardship she and her family were suffering because of her husband’s disability and inability to earn an income, and would continue to suffer if they were obliged to wait 24 months before a disability claim could be assessed.

16. We asked the insurer to reconsider whether the claim could not be paid on an equitable basis, taking into account all the circumstances, including the perspective of Treating Customers Fairly.

Result

17. The insurer agreed to pay the claim.

SM
April 2016

CR363
Disability claim
Reasonableness of alternative occupation

The applicable definition of “Occupationally Disabled” read thus:

“The Life Covered is Occupationally Disabled if he or she is unable, due to illness or injury, to perform the duties of any occupation which the Life Covered could reasonably be expected to follow, taking into account his or her education, training, experience and employment history.”

It was common cause that at all relevant times the complainant was employed as a so-called “paramedic”; that, as a result of being injured, the complainant was permanently and totally unable to perform the duties of a paramedic, and that he was
employed as an administrative clerk by the same employer for which he worked as a paramedic.

The question which had to be answered in this complaint was whether, having regard to the said definition and the facts, it was reasonable to expect the complainant to work as an administrative clerk?

For the reasons which follow a meeting of Adjudicators in the office answered the said question in the negative:

• The complainant enjoyed his work as a paramedic and that work had a measure of glamour and prestige to it. The complainant was suitably trained as a paramedic and met all the requirements for that position which he held for nearly 20 years. The complainant’s work as a paramedic involved a small component of administrative work and he did not receive any training to work as an administrative clerk. The complainant enjoyed the status which comes with his registration as a paramedic with the Health Professions Council of South Africa. As a result of his injury the complainant terminated this registration.
• The complainant did not function in the way in which a normal, healthy administrative clerk would work. The insurer submitted that the complainant had been “reasonably accommodated”, but in the report of an Occupational Therapist, it was said that the complainant “will require to work alternating between sitting and standing positions or be permitted to take frequent posture breaks”.
• The evidence established that the complainant was a fit, healthy paramedic who performed an exciting job, but now worked as an administrative clerk for whom adaptations had to be made in his workplace and who had to be “accommodated”. The complainant said that as a result of his inability to sit for any extended period he has to avoid getting caught in the traffic when he drives to work. This meant that he has to leave home at an inordinately early hour to avoid the rush hour traffic.
• The complainant’s employer wanted to retrench him, but he was not prepared to accept that. An agreement was reached in terms of which the complainant was “accommodated” as an administrative clerk at the same salary which he was earning at the time. It did not appear to the meeting that the insurer grasped the full import of the change in the complainant’s occupation, which involved the following adverse consequences:

o The complainant suffered a substantial reduction in his “take home pay”. This was so because he no longer received overtime remuneration and so-called “danger pay”.

o As a result of the fact that he was appointed as an administrative clerk at the same salary which he received as a paramedic, it was unlikely that the complainant would ever enjoy any real salary advancement in his current position.

o The complainant lost the opportunity to receive salary increases which he would have received as a paramedic.

o Significantly, the complainant lost the career advancement opportunities which would have been open to him as a paramedic. The complainant said that there was a demand for South African trained paramedics in Australia and New Zealand and that he had been “accepted” in New Zealand.

The complainant said the following about the effect of his injury:

• “Would you employ someone like me with no formal qualification in administration or computer literacy and has to work under the influence of narcotic medication and has to have a special standing desk and can’t drive a manual transmission for more than 20 minutes?”
• “Will I be able to obtain employment in the field that I have been practising for the past 20 years should I leave my current employer. Please keep in mind because of my injury that I will be trapped in my current post till the day I can no longer work.”
• “You should also consider my disability and the chances of migration into the real job market with me not having any formal qualifications and experience in administration. This challenges the phrase in the contract with regards to fair or reasonable alternative employment. The job status (registered with the Health Professionals Council of South Africa) and salary of a Paramedic (Paramedic salary goes up to R 375000.00 in 2014) is way higher than an administrative clerk (administrative clerks salary starts at R92000 in 2015).”
• “It is also very clear when you look at these two professions, (the insurer) is not making a fair interpretation as there is a massive salary discrepancy between these two occupations….”
• “No person that does administrative work could ever do what a paramedic does.”
• That he explained that he may undergo an operation which may alleviate his pain. This treatment depends on the availability of funding. If the operation is successful it would only help for his pain and not for his disability.

The insurer relied on the policy provision “that (it) is entitled to require that the life covered undergo a reasonable amount of re-skilling before we assess a claim”. In this regard the meeting concluded as follows:

• At no time did the insurer request any “re-skilling”.
• It was pointless to refer to the “re-skilling” requirement in vacuo.
• The insurer had not suggested any work which the complainant “could reasonably be expected to follow” taking into account the factors stated in the said definition, other than the administrative position which the complainant held.
• That the meeting could not think of any “reasonable alternative position” for which the complainant could be trained.

On a conspectus of all the relevant facts the meeting was quite satisfied that the complainant had established, by a comfortable balance of probability, that the present position which he holds is clearly not one which he “could reasonably be expected to follow, taking into account his … education, training, experience and employment history”.

It was pertinently pointed out that the conclusion reached by the meeting did not remotely imply that any onus rests on the complainant to prove what he succeeded in proving. The stance of the office with regard to the onus in a case such as this is clear – see CR132 on our website (ombud.co.za) and Life Insurance in South Africa by Nienaber and Reinecke page 359.

After the provisional ruling had been made settlement negotiations ensued between the parties, which culminated in a meeting at our offices at which the insurer agreed to pay the insured benefit to the complainant.

RM
April 2016

CR365
Pre-existing conditions
Disability benefit claim; pre-existing conditions clause does not cover complainant’s condition
Background:
1. The complainant had two policies, being a Personal Loan Protection Plan and a Credit Card Protection Plan, both these policies covering, inter alia, permanent disability.
2. The complainant was diagnosed with gout and arthritis a few weeks prior to the commencement of the two policies, and he became permanently disabled to perform his duties as a panel beater and a motor vehicle mechanic, some months after the commencement of the policies.
3. He submitted claims to the insurer under both the policies, which were declined on the basis of the exclusion of the pre-existing conditions, namely gout and arthritis.
4. The exclusion relied on was set out in the following provision in the policies (the wording of these policies were almost identical):
“X insurer will not pay any claim in the first 12 months after the start (or reinstatement) of cover because of any pre-existing condition you had when cover started. Pre-existing conditions are:
a. Any form of any of the following medical conditions (except for minor sickness, for example common cold or flu) that I(sic) have seen a medical doctor about or been treated for:

• heart disease or heart attack…;
• cancer;
• stroke;
• kidney disease;
• depression, epilepsy or fit;
• pneumonia, asthma, TB…
• disability; and
• diabetes.

b. The usage of any form of chronic (long-term) medication continuously for at least six months;
c. Having had any special test (like a scan or X-ray) that was reported as abnormal and required medical treatment;
d. Any treatment during the past 12 months for any form of back-illness, hip, knee or shoulder problem;”.
Discussion:
5. The policies define “pre-existing conditions” clearly stating, “pre-existing conditions are” (own emphasis) in four categories. Only paragraph c of the definition of “pre-existing conditions” is relevant in this matter. With reference to the clause above, the view of the office was:
5.1 Gout and arthritis are not listed as pre-existing conditions – the clause specifically narrows down the conditions setting out…”pre-existing conditions are…any of the following…” and there is no reference to gout or arthritis or similar condition.
5.2 There was no proof of the complainant having used chronic medication.
5.3 The complainant had a blood test at Lancet Laboratories prior to the inception of the policies and the results showed that he had gout and rheumatoid arthritis. If one combines the requirement of causation in paragraph 4 above, with paragraph c of the definition, the test would look as follows:

“X insurer will not pay any claim in the first 12 months which is caused by a condition for which you had a special test done and the result of which was reported as abnormal and which required medical treatment.”

Paragraph c requires more than a diagnosis in that not only must the result be abnormal, it goes further by adding “and required medical treatment”.

For purposes of considering this paragraph, it could be accepted that:
• The tests done at the Lancet Laboratories were “special tests”.
• The result of gout and arthritis were “abnormal”.
• The next question would be if the complainant required medical treatment. There was no proof submitted that the complainant’s doctor prescribed any form of treatment or that the conditions were so severe that he should have been medically treated. In fact, the information at hand was that the complainant’s doctor did not even discuss the test results with him. The insurer, that had the onus to prove that a pre-existing condition prevailed, was unable to show that the provisions of paragraph c were met.

5.4 The complaint’s condition also did not fall within paragraph d of the definition because there was no indication of him having suffered from “any form of back-illness, hip, knee or shoulder problem”.

6. In terms of medical evidence submitted, the complainant fell within the requirements of permanently disabled. The insurer was requested to consider the claims against both policies.
7. The insurer made further enquiries with the complainant’s doctor to ascertain if he required medical treatment for his gout and arthritis after the tests were done. The doctor subsequently submitted a note stating that after the positive diagnosis had been made, the patient did not return for treatment. The insurer was further of the view that if the complainant had returned for treatment, the cause of his disability some months later, may have been avoided.
8. The office obtained an independent medical opinion on the treatment of gout and arthritis and was advised that medical treatment is not always required after a positive diagnosis as some people prefer lifestyle changes, such a dietary and exercise options, instead of medication, and if the condition is not chronic, there may be a tendency to defer medical treatment until the condition becomes chronic.

Result:
9. The insurer responded by admitting the claims against both policies and paid the outstanding balances in terms of the policies’ provisions in the case of permanent disablement.
NvC
April 2016

CR368
Disability
Introduction
This case concerns the termination of the payment of a monthly disability income benefit which had been in payment for just over a year, after the insurer had discovered, through the use of electronic surveillance by forensic investigators, that the life insured was actively involved in the running of two businesses: a tavern and a construction business. Based on the information gathered during the video recording, the insurer had decided that the life insured was capable of performing a suitable alternative occupation.
The complainant objected to the use of the evidence that was obtained through the video recording, contending that the recording was made in violation of his right to privacy and that there is no guarantee that it had not been tampered with as it had been obtained by a company which was acting on the insurer’s instructions.
Discussion
Our office may, in its discretion, admit or refuse to admit evidence that was gathered by means of video recording.
Our procedure is to refer all such matters to a joint meeting of the office’s adjudicators for discussion, with a view to deciding, firstly, whether the recording is admissible or not, and secondly, if the meeting finds that it is admissible, decide what weight should be attached to the evidence that was gathered through its use.
The first step in that process is to enquire from the complainant if s/he consents to the adjudicators viewing the video recording. If the complainant consents, all the adjudicators will view the video recording and then decide on the admissibility of the recording and the weight to be attached to the evidence that was gathered through its use. In deciding on those two issues, the overriding consideration is fairness to both parties, having regard to all the facts of the case, the submissions by the parties and any other relevant consideration, which may include those set out on page 44 of our 2005 Annual Report as follows:
“Fairness may sometimes require us to have regard to relevant and reliable evidence. Like a court, we have a discretion to accept and consider such evidence, taking into account how it was obtained; whether it could have been obtained lawfully; the reasons why proper means were not used; the reliability of the evidence; whether the acceptance of such evidence would be so improper as to transgress constitutionality; the materiality of the evidence; whether such evidence was necessary to have a balanced view of the dispute; and the nature and degree of impropriety of obtaining the evidence”.
The giving of consent for the adjudicators to view the video recording is not construed as any concession on the complainant’s part that the recording is authentic, or that the recording is admissible and of evidentiary value.

If the complainant does not consent to the adjudicators viewing the recording, it does not mean that the recording will automatically, that is, for that reason only, be excluded as evidential material. It only means that the meeting must then decide, in its discretion, whether or not to view the recording without his/her consent. One of the factors which we will consider in this regard is the reasons why the complainant refuses to grant his/her consent. The complainant is, in that event given an opportunity to advance reasons for his/refusal.
If the meeting decides to view the recording despite the absence of consent, it will thereafter decide the two issues referred to in the paragraphs above after affording the parties an opportunity to make submissions of the nature referred to in the paragraph extracted from page 44 of our 2005 Annual Report.
Result
Having considered the submissions received from both parties, the meeting decided that the video recording should be viewed. However, after viewing the recording, the meeting concluded that even without considering the admissibility or otherwise of the video surveillance material, it would be more appropriate for the matter to be heard by a court of law. The reason for the conclusion was that there were serious disputes of fact in the evidence presented by the parties which could only be resolved by holding a hearing, and also material documentary evidence (some of it privileged) that the office would require access to and to refer to in determining the main issue in dispute. Furthermore, it was probable that the complainant would need to call witnesses who would invariably have to be subjected to cross-examination as is done during a trial: our office has neither the capacity, nor the authority to conduct a trial.
The parties accepted the ruling.

CNN
April 2016

CR374
Disability

Insurer ignoring relevant considerations concerning job description and physical nature of occupation; selectively relying on certain medical evidence while ignoring contradicting medical evidence

Background

1. The complainant, a farm manager, injured his right leg, knee and ankle in a tractor accident in 2012 (the tractor drove over his leg). After surgery and rehabilitation he still had pain, stiffness, swelling and impairment of range of motion, especially in his ankle, and walked with a crutch. He lodged a complaint with our office after his claim for an accidental injury benefit was declined, because the insurer maintained that he did not have the requisite “50% loss of lower limb function”. After extensive investigation, our office upheld the insurer’s decision on this claim.

2. The complainant had all along stated that he was struggling to work because of his injury, and he pointed out that: “The nature of my work is extremely physical and involves a significant degree of mobility, getting around the farm supervising employees in the orchard and fields”. We noticed that there was also disability for regular occupation cover on the policy, and asked the insurer to assess a claim for this.

3. The policy requirement for this benefit was that the insured be “totally, permanently and continuously unable to fulfil the occupational demands of the occupation engaged in for income immediately before the disability”.

4. The complainant’s treating orthopaedic surgeon stated in a report dated 25 September 2014 that “it is my professional opinion that [the complainant] cannot perform the work as manager of the farm as he cannot walk over uneven ground to check the farm workers. Even if an arthrodesis operation of the right ankle is performed, he will still not be able to walk on uneven ground, because of the stiffness of his ankle”.

5. A foot specialist (who did a paper review but did not see the complainant) stated that the symptoms appeared to be out of proportion to the x-ray changes, and that the impairment of the lower limb was 16%.

6. Although the insurer had mentioned that an occupational therapist report, employer declaration and job description would be needed to assess the disability claim, it apparently made a decision without this information, relying only on the medical evidence available, after obtaining an additional orthopaedic surgeon report.

7. The decision was to decline the claim. The insurer stated that the new orthopaedic surgeon opinion had indicated a stable right ankle with slight impairment in range of movement and only slight degenerative changes. The insurer was of the view that the claimant could not be regarded as totally, permanently and continuously unable to fulfil the demands of his occupation as a farm manager “which involves administrative work and supervising the activities of the farm workers”.

8. The complainant was not happy with the insurer’s decision, and we pursued his complaint.

Discussion

9. We firstly requested a copy of the new orthopaedic surgeon report from the insurer. This was provided, and we noted that the doctor had in fact concluded his report with the words:”Dit sal nie aangedui wees om lang afstande te loop veral oor ongelyke terrein soos op ‘n plaas oppervlakte nie, maar kantoorwerk kan sekerlik uitgevoer word”.

10. At this stage we requested to see any claim documentation taken into account by the insurer, including the employer claim form, job description and occupational therapist report.

11. The insurer provided a copy of an OT report (which it had commissioned). The OT stated, inter alia, that the complainant’s occupation was of a physical nature, and that he was required to walk most of the day to supervise farm workers, over uneven surfaces. After an extensive physical and functional assessment (testing posture, mobility and gait, balance, range of motion, functional muscle strength, sensation, endurance, pain, etc), she noted impaired range of motion in the back, hip, knee, ankle and foot, and limited movement and poor muscle strength in the right ankle and foot. She concluded that chronic ankle pain, inability to walk far, difficulty with climbing steps, weight bearing or standing for long periods, etc, “supports that the client is unable to perform his duties as a farm manager. Due to the longdurity of the client’s pain and the degenerative nature of his injury, his prognosis is poor. It is highly unlikely that the client will ever be able to perform an occupation of a physical nature even if an arthrodesis is performed”.

12. The OT report had not been mentioned by the insurer in the reasons given for its decision to decline the claim. When we challenged this, the insurer stated that the range of motion noted by the OT was impaired due to pain, which was “out of proportion to the pathology noted by the various specialists”.

13. We then asked the insurer again for the documentation detailing the complainant’s specific duties/job description, and the employer claim form, as this still had not been provided. The insurer then informed us that it had not received this information from the complainant, and had made its decision without this information.

14. We followed up with the complainant and obtained the job description and completed employer claim form, which we sent to the insurer. The employer indicated in the form (signed on 8 September 2015) that the complainant had last actively performed his work on 27 August 2012 (the date of the accident), and while his employment had not been terminated he had had extensive periods of sick leave, and his work status was marked “sick leave”. The job description indicated that, inter alia, a required competency was “good health and physical ability”, and that the farm manager was responsible for co-ordinating and controlling farming activities on the research farm, managing orchards, maintaining farm infrastructure, training trainees and emerging farmers, being responsible for harvesting and marketing of farm produce, etc.

15. We asked the insurer to re-evaluate the claim, now that it had complete information. The insurer responded that “it has been confirmed that the Declaration by Employer and sick leave records do not influence the decision to decline the claim”.

16. We pointed out to the insurer that this was an inadequate response, and that we required a detailed response, setting out the definition and illustrating how it had been applied in evaluating the claim, in relation to the medical evidence, the job description, employer’s declaration, sick leave records and the information provided by the complainant in his claim form as well as his correspondence with our office. We stated that each medical/OT report should be separately canvassed, and if there were any contradictory findings these should be extensively dealt with.

17. In response we received a determination from the insurer’s internal arbitrator, dismissing the complaint. From the reasons given it was apparent that the job description and physical nature of the complainant’s work had not been taken into account at all. Much reliance was placed on the fact that the complainant had not been officially discharged from service, which was taken as an indication that he was still able to perform his occupation. It was stated that “the current functional loss … is not permanent and would to a large extent improve”.

18. At this stage we decided to telephone the insurer, and again point out some of the problems with its approach. An undertaking was given by the insurer to obtain a further opinion from a doctor well versed in insurance claims.

19. This doctor promptly provided an opinion, in which he canvassed all the medical reports and other evidence, concluding that there was no dispute that the bulk (60-70%) of the complainant’s duties entailed physical work. He stated: “He is covered for regular occupation, which means that he needs to be assessed for his ability to do a physical work. Adapting his job output to a more sedentary type of work is not a policy requirement.” As he was unable to fulfil 60-70% of his duties, it was “fair to assume that he is totally disabled”.

20. The doctor pointed to the objective evidence of sequelae of the initial injury: “A CT-scan and bone scan demonstrated active arthritis with degenerative changes of the tibiotalar and subtalar joints to the extent that a subtalar fusion has been proposed. This is confirmed by constant pain and reduced range of motion of the ankle joint. Treatment options have almost been exhausted. The only remaining option is an arthrodesis. The success of this operation can unfortunately not be guaranteed, and it has inherent risks; therefore such surgery cannot be enforced as a treatment option. Therefore for practical reasons the condition should be regarded as having reached maximal medical improvement (MMI), implicating that it is permanent”.

21. The doctor was also of the view that the weight of the medical evidence (two orthopaedic surgeons and the OT) supported disability. Only one doctor found the symptoms incongruous with the pathology. The doctor stated: “However, with the added objective proof of active arthritis on CT-scans, and the proposal by the treating doctors to do an ankle fusion, one has to conclude that the client is disabled as defined”.

Result

22. The insurer then paid the claim. Interest was also paid in respect of the long delay in reaching the decision to admit the claim.

SM
April 2016

CR339
Disability

Could the complainant be considered totally disabled if she was capable of performing a part-time job only, and was she suited to the alternative occupations suggested by the Occupational Therapist?

Background

1. The complainant was employed as an Estate Agent (Manager) from 2005 until she was diagnosed with SLE (Systemic Lupus Erythematosis) in April 2007. Her complaints were related to her skin with painful lower limbs, she was intolerant of bright light and she suffered from itchiness of the skin. As a result of the severity of her illness she was completely housebound during the period between 2007 and mid-2009. In March 2009 she took up work with another company on a part-time basis but chose to work from home because of the increasingly debilitating effects of the SLE.

2. Pursuant to the above, the complainant submitted claims for occupational and capital disability benefits to the insurer on her various policies with them. Some of these policies provided her with occupational disability benefit cover and others with capital disability benefit cover.

3. The occupational disability benefits were defined as follows:

“A Occupational Disability Benefit claim will be admitted once (the insurer) has established:

• that the Life Assured is totally and permanently disabled and incapable of performing the duties of their own occupation, or of any other occupation which could reasonably be expected to follow, taking into account their education, previous training and work experience.”

And the capital disability benefits were defined as follows:
“A Capital Disability Benefit claim will be admitted once (the insurer) has established:

• that the Life Assured is totally and permanently disabled and incapable of performing the duties of their own occupation, or of any other occupation which they could reasonably be expected to follow, taking into account their education, previous training and work experience.”

4. Subsequent to the submission of the complainant’s claims, the insurer made an arrangement for her to be assessed by an occupational therapist (OT) in order to evaluate the extent of her disability. The OT considered a number of documents and made the following observations:

“The fact that (the complainant) is still working on a part-time basis indicates that she remains capable of performing the duties of an Estate Agent but with limited endurance to do so on a full-time basis. As an alternative to her current occupation as a part-time Estate Agent she would also be capable of managing an estate or letting agency albeit perhaps also on a part-time basis. This would allow her to work entirely indoors, which may in fact be more suitable than the job that she is doing currently, which requires her to spend some of her time outdoors.”

5. The OT also acknowledged that the condition of SLE had affected the complainant to some extent in all aspects of her life i.e. work, home, personal and emotional. She expressed the view that the cyclical nature of SLE would result in alternating periods of relapse and remission and the complainant would have to endure the effects of the condition and the possible progression of the disease for the rest of her life.

6. The insurer declined the complainant’s claim on the ground that she was still working and not totally and permanently disabled as defined in the policy documents. The complainant then lodged a complaint with our office questioning the conclusion reached by the OT and contended that she could not be exposed to sunlight and air conditioning environments.

Discussion

7. The matter was discussed at the meeting of adjudicators where the grounds relied upon by the insurer for the repudiation of the claims were considered. The meeting noted that SLE is a progressive disease, such that the complainant would probably qualify at some stage for the payment of the benefit. In view of the above a recommendation was made that the insurer should consider making an offer to pay a monthly income or a percentage of the benefits instead of the lump sum.

8. The insurer refused to do so, saying that the complainant’s occupation was that of an administration manager doing 100% administration. The insurer submitted that the complainant would be capable of performing a more office bound administrative job, one not requiring travel or exposure to bright light as per the occupation stated when applying for her policies. Moreover, the insurer averred that if they accede to the recommendation they would set a precedent that they could not sustain. They stated that there are products that insure against partial loss of income as a result of an illness or injury. These products, they claimed, were more expensive than the lump sum benefits, and the complainant had taken the cheaper option. As a result, they said, she did not qualify for a valid claim under her policies.

9. We noted that the insurer’s response was not entirely correct insofar as the complainant’s occupation was concerned. We pointed out that the complainant had a number of policies and there was only one policy in which her occupation was recorded as 100% administration.

Result

8. The insurer decided to accept liability towards the claims and payment was made accordingly.

NS
Feb 2013

CR355
Disability

Claim for disability benefit on psychiatric grounds declined by insurer – insurer not attaching sufficient weight to available evidence, and misdirecting enquiry to consider chronicity of condition, not required by the policy definition

Background

1. The complainant worked as a general manager for a car dealership. His duties included managing financial returns, staff and branding, and the experience required for the job included leadership and financial understanding. 60-70% of his work was administrative, and the rest of his time was spent with staff and customers.

2. In about 2002 the complainant was diagnosed with diabetes, hypertension and hypercholesterolaemia. By 2006 he was suffering from fatigue, related to poor control of his blood glucose. In 2011 he saw his doctor with symptoms of stress and anxiety and was started on medication for anxiety. A diabetes educator indicated that he struggled to control his blood sugar because he was under stress at work.

3. In 2011 the complainant’s employer submitted a claim for a total disability benefit on his behalf, against its group scheme policy. The employer claim form stated that he had stopped work in May 2011. According to the employer he was no longer able to handle the stress and responsibility of his title; he had become forgetful, staff showed him no respect, and he was not producing the financial return required by shareholders. In an attempt to accommodate him, the employer had transferred him to a smaller dealership in another town, but he had not improved.

4. The insurer declined the claim, on the grounds that episodes of hypoglycaemia could be managed and there was no objective evidence supporting disability.

5. A further claim was submitted some months later, with a report from a physician, who recommended that the complainant consult a psychiatrist and a psychologist. There was also a report from a psychiatrist whom he had consulted. The psychiatrist indicated a diagnosis of generalised anxiety disorder and major depression, which had become progressively worse over the previous two years. This had a negative effect on his cognitive functioning, and the psychiatrist was of the view that he had a poor prognosis, given his age. He was on treatment (anti-depressants, anxiolytics and sleeping tablets), but had not responded well.

6. The claim was again declined, on the grounds that there was limited objective evidence of a total inability to perform his occupation. The insurer was of the opinion that the symptoms related to changes at work, and that this was an employer-employee issue.

7. The claim was resubmitted with an occupational therapist (OT) report. The OT found that the complainant had poor concentration, poor memory, slow thought processes, poor motivational levels, high levels of depression, anxiety and irritation, frustration and aggression. She concluded that he was not able to cope with his job demands.

8. The insurer declined the claim for a third time, stating that the complainant’s hypertension and diabetes were reasonably well-controlled on medication, that there were no objective test results to support the reported cognitive impairment, that there was no evidence that the complainant had seen a psychologist (as recommended by the physician), and that he had only been seeing the psychiatrist for about three months when the psychiatrist reported that he was not responding to treatment. The insurer mentioned that ASISA guidelines on the management of psychiatric disability claims clearly state that “no specific psychiatric disorder is in itself an indication for permanent disablement”. The insurer also stated that a psychiatric disorder “can only be specified as chronic after the full criteria have been met continuously for at least the past two years”. In the insurer’s view there was a lack of objective evidence to support the complainant’s total disability, and it was not prepared to pay the benefit.

9. The complainant then lodged a complaint with our office.

Discussion

10. We examined the medical and other evidence, including the complainant’s job requirements, and considered the requirements of the policy. We then wrote to the insurer, raising several concerns.

11. The benefit for the first 24 months (after the expiry of a waiting period of three months) would be paid if it was determined that the insured member had been rendered totally incapable of engaging in his own occupation by injury or illness.

12. It was obvious that the complainant’s occupation had high cognitive demands. According to the employer these were not being met. The employer had tried to accommodate him, but the transfer to a smaller dealership had in some ways exacerbated his stress, as he had to travel a longer distance to get to work.

13. The insurer had made much of the fact that the complainant’s hypertension and blood glucose were controlled on treatment, and had emphasised that “the claimant needs to take responsibility for adhering to optimal medical management of his disease”. However, we were of the view that insufficient account had been taken of the particular pressures and stresses of the complainant’s occupation. The report of the diabetes educator indicated that the complainant was ‘conscientious in doing everything in his power to keep his blood sugar under control. He exercises on the Orbitrek regularly and his wife makes sure that his meals are healthy… He monitors his blood sugar regularly but still is unable to keep his blood sugar stable and controlled”. She pointed out that the complainant had tremendous stress at work and found it difficult to eat on time because of the nature of his work, which sometimes led to his experiencing hypoglycaemia. She had recommended a reduction in work stress. We pointed out to the insurer that transferring the complainant to a smaller dealership in an attempt to reduce his stress had not helped much. In our view this indicated that there was an inherent level of stress associated with the occupation of general manager, and a limit to the scope for reducing such stress.

14. The insurer had taken the view that there was limited objective evidence of the complainant’s psychiatric condition, and that three months treatment was too short a period. In our view the insurer had failed to take proper account of the psychiatrist’s remarks that “Late onset depression has a worse prognosis than early onset and treatment is usually more difficult and will have to be for life. Response to treatment also takes longer later in life”. The complainant’s age (62) should have been given due weight in the circumstances.

15. We also pointed out that the definition of disability in the policy did not require permanence (or chronicity) of a condition, but only that the member be “totally incapable of engaging in his own occupation”. In any event, latest approaches in assessing permanence of disability did not necessarily require adherence to a timeframe of two years treatment, the acceptable standard being that major depression, for example, could not be considered permanent until it had been shown that a reasonable attempt had been made by the claimant and his treating psychiatrist to comply with internationally accepted treatment guidelines, and that such treatment had proved unsuccessful. As stated however, permanence was not the issue in this case.

16. The psychiatrist’s opinion was that “Taking age, reason of onset into account as well as slow response, I am of the opinion that he is medically unfit to return to work and even if he responds reasonably well to treatment he will relapse on returning to work. The depressive episode has had an extremely negative impact on his self esteem, decision making and drive-energy in his post which required a high functioning self assured individual”.

17. The psychiatrist also stated that the depression and anxiety disorder had had a negative effect on the complainant’s cognitive mental functioning and memory, leading to impairment in judgement and processing of data in his work place, which in turn led to mistakes. According to the psychiatrist this worsened his depression and self esteem and ability to cope in a competitive working situation – “so-called ‘Burn out syndrome’”. The insurer had taken issue with the fact that there was no evidence of testing the complainant’s cognitive abilities. In our view the psychiatrist’s professional opinion that the complainant’s depression and anxiety disorder had had a negative effect on his cognitive functioning was a prima facie indication that this was so, and if the insurer wished to investigate this further it should arrange a neuropsychological testing and evaluation, at its own cost.

18. Our investigation revealed further that the complainant had continued treatment with his psychiatrist, seeing him regularly over a total of ten months, during which time the psychiatrist had booked him off work. In our view the fact that he did not consult a psychologist should not be regarded as adverse. It was not always appropriate to be treated by a psychologist as well as a psychiatrist. The complainant was under the regular care of a psychiatrist, who had presumably advised him as to how his condition should best be treated.

19. We put it to the insurer that the complainant had not worked for a year, having been certified unfit to work by his psychiatrist. This must carry considerable weight in an assessment as to whether he was totally incapable of engaging in his own occupation.

Result

20. After considering our letter, the insurer stated that it would like to refer the complainant, at its expense, to an independent psychiatrist for an opinion. We agreed that this was a reasonable proposal. An opinion from a doctor who is not treating the claimant is of considerable value in a disability assessment, and adds to the body of information available so that a fair decision can be taken. The complainant accepted this proposal as well.

21. The insurer arranged a consultation for the complainant with a psychiatrist of its choice. The psychiatrist delivered a report, concurring with the diagnosis of general anxiety disorder and major depression, and noting that the complainant’s symptoms had never been in remission. His mental state examination revealed mild to moderate impairment in concentration, short term/working memory, and executive functioning, with depressed, anxious and irritable mood. The medication he had been taking was well known and established, but he had not responded well to treatment. The perceived prognosis was poor, due to his poor response, age, underlying medical conditions and sustained work situation.

22. The insurer admitted the claim and immediately commenced paying the monthly income benefit.

SM
September 2014