This blog was co-authored by Maano Manavhela, Candidate Attorney.
A life insured, who suffered heart and arterial disease in April 2012 requiring a coronary stent and was paid 10% of a benefit amount, a bi-femoral bypass and paid 90% of the benefit amount in July 2012, was awarded another 100% of the benefit amount following an acute heart attack on 15 August 2015.
The policy provided that the benefits specified in the schedule (the total benefit amount) was payable if the insured suffered one of the “events or conditions” described in the policy under thirteen separate benefit groups.
A reinstatement clause automatically reinstated the benefit amount after a 14 day survival period if an event occurred that was a totally unrelated condition to the condition or event for which a previous claim was paid.
The benefit groups included a cardiovascular benefit group, a cancer benefit group, other benefit groups, and a catch-all benefit group. The cardiovascular benefit group identified 12 events and provided that only one payment would be made per cardiovascular event with a single event being defined as all cardiovascular conditions or procedures that occurred within a 30 day period.
According to the reinstatement of benefit clause, if the conditions giving rise to the two claims were unrelated, then only 14 days would have to expire between the first and second claim. Both claims could in that event be paid up to 100% each as the benefit amount automatically topped up for unrelated claims after 14 days. The policy did not provide that once 100% of the benefit amount in a particular group had been paid, no further payments would be made for such group. Because there were twelve events described under the cardiovascular group, the insured could claim for each event once. The insured could in principle claim for a different event every six weeks. A single event was defined as all cardiovascular procedures that occur within a 30 day period (four weeks) and a claim was only admitted after a 14 day (two week) survival period.
According to the express wording, the policy responded per event. Therefore despite the insured having been paid 100% of the benefit amount for the first two events he was entitled, according to the judgment, to 100% for the third event.
This was an unusual case where a number of conditions resulting from heart disease occurred. It is difficult to rely on as a precedent because of the way in which the case was presented to the court. For instance, no medical opinion evidence was led as to whether the cardiovascular events were related or not.