INSURANCE
Curveballs A paid-out critical illness policy at age 73 can be life changing. It was for Richard Parkinson
24 FORUM FEBRUARY 2021
PHOTO: ISTOCKPHOTO
W Critical
hen it comes to critical illness insurance (CI), the biggest concern for advisors and clients alike is whether a claim will be paid. For example, in 2018, a woman was denied a claim for $300,000 because the illness she claimed, aplastic anemia, wasn’t on her policy, which only covered three illnesses. Last year, another case was a 67-year-old male, who had a $500,000 CI policy that he cancelled effective April 1, 2017. In May 2017 he was diagnosed with life-threatening cancer, so he initiated a claim, which was promptly denied as the policy was no longer in force. He took the matter to court where he lost his case because the contract clearly stated that a potential claim begins from the date of diagnosis, and since his policy had already been cancelled prior to that date, his claim was also denied by the court. The message from these two stories is: • Read the contract to fully understand what is included and what is not!
