Why claims get rejected

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The Dangers and Prevalence of Non Disclosure in the Insurance Industry.


One of the most overlooked issues with insurance in New Zealand, is a lack of full

disclosure that occurs on many policy applications and its negative impact at claim

time. This is particularly prevalent in Health Insurance claims, probably due to the

higher frequency of Health Insurance claims per policy compared to Trauma-,

Disability- and Life cover claims. The impact of repudiation of a Life Insurance or a

Disability claim will arguably prove a lot more devastating to families than nonpayment

of a Health Insurance claim, where many claimants still have access to

the National Health System. Non payment of Life and Disability claims may lead to

poverty in many instances.


Generally, insurers in NZ have a good claims paying reputation but sadly, it has

come to my attention over recent years, that some immigrants do not fully disclose

all relevant medical history in the old country, believing that this will remain

undetected. When a condition re-occurs, the history is normally disclosed to the

Insurer by the local Doctor in the claims process and this can render such a claim

void due to non-disclosure at time of application.


It is believed that the chances of non disclosure may be a lot higher with online life

insurance applications or policies taken out with banks or online, compared to

those taken out through dedicated experienced Advisers who have been in the

business for many years and who have assisted clients with claims. It has been

said that a Life Insurance Adviser cannot truly call him/herself an Adviser if they

have not assisted a family through a Life Insurance claims process. It is important

to know that the consequences of non-disclosure of material information during the

application process may have a devastating impact at claim time, whether nondisclosure

was deliberate or not, and also whether the application form was

completed by the client or the adviser, on behalf of the client.


We advise that, if policy owners have doubts about full disclosure on their

applications, to speak to their broker to rectify it. Fritz is willing to investigate

possible non-disclosures for those who do not have a dedicated Insurance Adviser

and for existing clients who have doubts about full disclosures. Please do not

hesitate to contact us if you have any doubts about possible non-disclosure on

your cover application so that we can help you to set the records right. We know

how to investigate this very confidentially and effectively.


Fritz can be contacted on 09-4735210 for a confidential discussion or to arrange

for an appointment, or send an e-mail to Fritz on fritz@fritzswart.co.nz



Copyright 2003 - Fritz Swart - All Rights Reserved.