In March 2011, Mel suffered a stroke. Mel’s daughter contacted their insurance adviser and left a message to say Mel had suffered a stroke and would like to make an insurance claim under her trauma policy.
Mel’s daughter said the adviser returned her telephone call a couple of days later and told her that Mel did not have trauma insurance in place and therefore could not make a claim.
In 2015 Mel met with a new insurance adviser. The new insurance adviser reviewed Mel’s current policies and found she did have trauma cover in place.
Mel made a claim to her insurance company for her stroke, and the claim accepted in January 2016. Mel received a lump sum payment of $12,000 and a refund for the premiums she had been paying since the stroke occurred (under Mel’s policy the trauma benefit could only be claimed once).
Mel comes to FSCL
Mel complained to FSCL that the adviser had incorrectly told her that she did not have trauma insurance in place. Mel said that had her claim been paid soon after she suffered the stroke, this would have allowed her time to recuperate at home. However, due to financial pressure, she had to return work earlier than her doctor advised.
Mel believed that she should receive compensation from the adviser for not being paid the trauma lump sum soon after she suffered her stroke.
The adviser’s position
The adviser said he had no record of any contact with Mel or her daughter in 2011 in his file notes, which dated back to 1999 when Mel first became a customer. The adviser said he had no reason to tell Mel she did not have trauma cover in place.
We reviewed Mel’s outgoing telephone calls that she had retrieved from her telephone provider.
We found one call to the adviser on 3 April 2011, a few days after the stroke, which lasted 57 seconds. We considered this call was long enough for Mel’s daughter to leave a detailed message.
The adviser provided his outgoing phone records which showed he had made two calls to Mel on 4 April 2011 one which lasted 19 seconds and a later call which lasted 11 seconds. The adviser said that after he had made two attempts to return the message, he must have decided to stop trying on the basis that if it were urgent the caller would try contacting him again.
With limited evidence to support either view, our decision was made on the balance of probabilities.
We found it was certain that Mel’s daughter left the adviser a message and the adviser must have received it for him to try returning the telephone call the following day.
While there was no way of knowing what was said in the message, we considered it likely that Mel’s daughter would have mentioned wanting to make an insurance claim.
We found the adviser should have made more than two attempts to contact Mel about the claim.
We agreed that Mel had suffered inconvenience as a result of a four year delay in having her insurance claim processed and paid. We considered $1,000 an appropriate amount of compensation for the inconvenience the adviser caused Mel and formally recommended that the adviser pay Mel the compensation. Mel accepted our recommendation and the compensation was paid.
Under our terms of reference, we can award compensation up to $2,000 for non-financial loss, including stress or inconvenience caused to a complainant by a participant’s actions or omissions.
It is best practice for our participants to keep detailed and up to date file notes in case situations like this arise.