Claim declined due to an underwriting problem:What can you do

It’s important to understand your underwriting before committing yourself to a medical insurance policy. Failure to understand the impact the underwriting will have on your policy can lead to you making claims which will not be covered on your policy. It’s important to know the facts so you can set yourself realistic expectations. There’s nothing worse than pinning your hopes on something being covered privately, only to find out when you claim that you’ll need to fund it yourself or use the NHS.

The majority of the time when your claim is denied for failing to satisfy the underwriting there is nothing you can do. After all, as it falls outside of the scope of your policy your insurer isn’t obliged to cover it. However, there are occasions you may be able to contest your denial, such as when your claims assessor makes a material mistake. If you’re mis-advised, even though your claim shouldn’t be covered your insurer may offer you a without prejudice payment to make up for their error.

I’ve compiled a list of the most common reasons your claim will be denied based on underwriting types. Take a look and see what you need to watch out for when making a claim.

Moratorium underwriting

Failure to satisfy the 2 year clause – Claims for conditions which do not satisfy the 2 year clause will be denied. If you’ve not gone a full 2 year clear period from the start of your policy without seeking advice, treatment or taking medication for a condition you have suffered from 5 years previous, your claim would be ineligible. The complexity of the 2 year clause means it’s even misunderstood in insurance circles, so there’s no surprise policyholders can fail to grasp what is and isn’t covered. Remember your claims assessors aren’t infallible and sometimes they’ll get it wrong too, so don’t be afraid to challenge their decision if you think it’s wrong.

Fully medically underwritten underwriting (FMU)

Non Disclosures – All FMU policies require applicants to submit a detailed medical history which is scrutinised by your insurers underwriting department before offering you a premium. At this point any exclusions will be applied to your policy. It’s important you declare all your medical history at this point, as if it later comes to light that you suffered from symptoms or a condition that isn’t stated on this form it could invalidate your policy.

Insurers usually choose to take a lenient view on this, after all how many of us can remember symptoms we had 10 years ago, but it still means your claim will be put on hold while your policy is sent back to the underwriting department to be re-underwritten. If the condition you’ve left out is significant it could lead to a new exclusion being added to your policy. This means that your claim will be denied, and you won’t be able to claim for this condition in the future either.

Policy exclusions

If you have an express exclusion on your policy it stands to reason if you claim for this condition cover will be denied. However, many policyholders don’t realise that after a period of time (maybe 2 or 5 years) you can ask your insurers underwriting department to review many existing exclusions. While it’s unlikely your exclusion for a broken leg will be removed, as now your bones will be weaker making future breaks more likely, if you suffered from a skin complaint or something similar your insurer may be happy to remove the exclusion for this.

Continuing medical exclusions underwriting

See the above examples for fully medically underwritten policies, as both types of underwriting operate largely on the same basis.

If you’re not happy with your denial, ask your insurer to send you the reasons for this in writing, with complex cases this can make it easier for you digest rather than making notes over the phone.

If you believe your claim has been denied unfairly making a complaint can ensure a speedy review of your case. Don’t be afraid to request calls to be listened to and take your complaint further to the ombudsman if you’re still unhappy. UK law is protective of consumers and if your insurer is in the wrong they’ll quickly realise this and grant you cover. However, the majority of the time denials are correct and policyholders have simply failed to understand the terms and conditions of their policy. Don’t let this be you. Check your policy documents carefully and always ensure you know how your underwriting works before taking out a new policy.

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