IFA in payment battle with Canada Life
IFA Richard Kafton is pursuing Canada Life for remuneration as a result of extra work he undertook to get the insurer to pay out on a client’s group income protection policy.
Mr Kafton, managing director of London-based Cedar House Financial Services, said it had taken nearly two years for Canada Life to settle a claim from his client who had a brain tumour.
As a result of the additional work he was required to undertake since early 2011 until the end of May, when the insurer finally agreed to pay out, Mr Kafton invoiced Canada Life.
He said he was considering legal action after Canada Life refused to pay him a satisfactory amount.
Mr Kafton added: “There is a convention in financial services that if an IFA is called upon to do extra work as a result of an insurance company’s negligence, the IFA can issue an invoice.”
However, a statement from Canada Life said the claimant was originally absent in October 2010 but Mr Kafton was not contacted by the company until January 2011. It claimed it only received notice of this in February 2011.
There were two claims, one which was settled in November 2011 after the claimant returned to work. The claimant then went absent again and a different claim was logged. Canada Life asked for medical evidence to see if these claims were related and subsequently agreed to link the two claims.
A spokesman from Canada Life said: “This particular case is complex in that it involves two separate claims on a Group Income Protection policy. A settlement was made on the initial claim for a short period of absence, as the medical evidence supported the claimant’s return to work. A subsequent claim was made but the claimant left the policyholder’s employment before a medical assessment could be completed.
“Following further discussions, Canada Life agreed to link the two claims and offered to pay benefits for the time the claimant was employed. We also agreed to obtain the medical evidence necessary to consider whether it would be appropriate to take on liability for the claim under the “pay direct” provision.
“Canada Life is a major provider of Group Income Protection insurance, fully committed to treating all its customers fairly. Whilst we do not accept that there have been errors in the assessment of these claims, we appreciate that additional effort has been necessary by the adviser to fully investigate the circumstances.
The statement said the insurer may be willing to offer Mr Kafton payment for servicing outside normal client work, but it “was surprised” it had not been given more time to respond to his letter, which the spokesman said Canada Life received on 10 August.