CR107
Exaggerated marketing material

Background
The product provides cover for certain surgical procedures. The contract is sold by means of direct marketing with a mail shot being sent to the customers of a particular bank who were already policyholders of the insurance company concerned. The mail shot sent to potential policyholders included a document which featured an application form and also included a list of surgical procedures covered by the policy. The list of surgical procedures which featured in this particular document differed markedly from the policy wording and this would seem to stem from the fact that in the marketing material consumer friendly wording has been adopted. In many cases this resulted in a generalised description or an abbreviated description of the impairment / procedure whereas the cover as described in the policy was very specific.
Particular complaint

In a particular complaint submitted to the Ombudsman’s office the procedure which the complainant underwent was an acromioplasty and lateral clavicle resection. This was not in fact covered by the policy but the complainant was of the view that the procedures described in the marketing material as “repair of joint” implied that he was in fact covered.
Assessment

The Ombudsman consistently takes the view that if descriptions of benefits set out in illustrative leaflets, brochures or application forms are in any way ambiguous resulting in uncertainty or doubt, the decision goes against the party responsible for drafting the document. Furthermore it is the view of the Ombudsman that where a contract was clearly induced by the marketing literature, the policyholder is entitled to appropriate relief, notwithstanding the fact that the insurance contract itself may be worded differently.

Result

The Ombudsman found in the complainant’s favour and the insurance company abided by this decision.

DM
October 2005