CR359 Dread Disease

Dread Disease
When did Dread Disease claim arise?
The insured suffered from sinus and swelling in his neck and consulted a doctor. He was treated with antibiotics. About one month later the insured turned 65 and the policy’s cover for the benefit expired. The swelling in the neck did not dissipate and the insured again consulted a doctor, who referred him for a biopsy. The pathology report revealed that the insured had mandibular lymph nodes, indicating metastatic carcinoma.
The insured submitted a claim to the insurer under the cancer benefit. The claim was declined on the grounds that the cover had expired about six weeks previously when he had turned 65. The policy states:
“Expiry Date
(The name of the product) will expire on the anniversary of the Commencement Date immediately preceding the Life Assured’s 65th birthday or when contributions cease to be payable, should that be earlier.”
The insured submitted a complaint to our office and the matter was investigated. The insured’s medical attendant confirmed that the nodes in the neck , which had been present at the first consultation, subsequently turned out to be squamous carcinoma.
The insurer’s response was that the policy requires the histological diagnosis of cancer to be evident prior to the expiry of the cover. Cancer is defined as follows in the policy:
“The manifestation of malignant tumour, including leukaemia and Hodgkin’s disease, supported by a histological diagnosis.”
The policy describes three categories into which the various conditions could fall. Under “Benefit”, the policy states that a claim will be admitted if satisfactory proof is submitted to the insurer that the life assured (1) has suffered major burns, a coma etc, (2) or undergone coronary artery disease surgery etc or (3) “is suffering from cancer”, paraplegia etc.

It was the office’s view that the histological proof was not required prior to the expiry of the benefit, provided the condition had manifested itself prior to expiry and was subsequently medically confirmed. The insured, therefore, had to show that he was suffering from cancer from a date prior to expiry. The condition had manifested itself prior to the expiry date and the nodes were proven to contain malignant tumours when tested a few weeks after the cover had expired. These nodes did not appear over night when he was referred for a biopsy and they were probably present before cover had expired.

The insurer was asked to re-consider the claim, which was subsequently admitted.
September 2014