Ex-IFA slams poor insurer response to cancer claim

Highlighting ongoing issues over poor communication and poor client service during the claims process, Katz told FTAdviser he had faced delays of up to two months to receive any money from both Prudential and Scottish Provident at an extremely stressful and difficult time for him and his wife.

Katz said he had a whole of life policy from Prudential in his wife's name but he was the owner of it.

When he got his diagnosis in August 2020, it "made sense to cash this in". However, he claimed: "They mucked about in September and did not pay until November."

At the same time, he had a critical illness policy with Scottish Provident. As a former adviser who had often stressed the importance of protection policies to his clients, Katz said he immediately turned to the CI policy to make a claim. 

They've paid their premiums all their life, sacrificing in order to keep their cover in place and they cannot get it when they really need it.Katz

Katz said: "Initially I sent them the wrong policy number and I noticed this; the very next day on September 10 I sent them the correct one. I also sent Scottish Provident a discharge paper stating what I had and what my cancer diagnosis was.

"This was not good enough for Scottish Provident, who sent me a cryptic email in response which said nothing. It was poor communication throughout."

He claimed he and his wife had been left calling and calling but the "phones dialled out for ages". When he did get through, the insurer could not tell him what it was waiting for so it could make the payout. 

"From September to November I had to wait for my CIC policy to pay out - two months. If this had been one of my clients, they would have been onto me like a shot and I would have helped them out.

"But when it's just you on your own, you really are in the deep 'doo-doos'. It's not funny, it really isn't. At the very least I have knowledge of the market - clients generally do not", Katz said.

He said when he was able to get his wife to speak with Scottish Provident, the call handler apologised and said the money would be sent within the next 10 days. But by then it was several weeks since he had informed the insurer of his cancer diagnosis.

Katz added: "I was in a fortunate position and not desperate for the cash but what about all the people who are in financial trouble? They've paid their premiums all their life, sacrificing in order to keep their cover in place and they cannot get it when they really need it. 

"This is inexcusable."

Katz, who is still undergoing chemotherapy for his cancer, said when setting up hundreds of policies for his clients, the purchasing process has been very simple and quick - but his experience of the claims process has been "painful".

He commented: "You feel all they want is the money. I bought policies myself, I sold them to clients. The idea of protection is good but the execution when it comes to paying out is poor."

Response

Prudential and Scottish Provident - which is owned by Royal London - both looked into Katz's case. 

According to Prudential, the insurer did send him a complaint response on October 25 last year, which apologised for the delay and confirmed a payment of £256.45 was being paid to him.

Some £200.00 of this was an apology for the distress and inconvenience he experienced and £56.45 net interest for the delay between 29 September and 20 October. 

However, following FTAdviser's query, the company "looked again" at the timeline of Katz's case and agreed it could have been in a position to pay him on 17 September rather than 29 September, so it has considered that a further 12 days' interest on the life policy should have been paid. 

We apologise to Mr Katz for the delay in paying his funds at a time of need.Prudential spokesperson

This would have resulted in an additional £10.50 being payable to him. The Prudential has now also offered Katz a further £150 for the trouble and upset of the interest not being correct and the fact he has had to raise this again.

A spokesperson for Prudential commented: "We apologise to Mr Katz for the delay in paying his funds at a time of need and for the difficulties he experienced in trying to contact us.

"We have reviewed his policy to ensure that he has experienced no financial loss as a result of the delay and offered him compensation of £350 for the trouble and upset caused."

Similarly, Scottish Provident revisited the case after FTAdviser contacted the insurer. 

A spokesperson for Royal London, which owns Scottish Provident, said: "We understand making a claim on a critical illness policy is a worrying time for both the customer and their family and we always aim to make sure the process is handled with empathy and as quickly and efficiently as possible.

“Before we can settle a critical illness claim certain evidence needs to be provided. The initial medical evidence we received wasn’t sufficient, so we requested additional information from Mr Katz’s consultant and from Mr Katz himself.

"This was received on 28 October and 29 October respectively, and after being assessed was paid promptly."

This comes a few weeks after FTAdviser revealed how life and pensions provider Scottish Friendly failed to pay out the fee due to adviser Julian Pruggmayer, principal of Financial Risk Management.

Pruggmayer is still in a "slow recovery" from being declared clinically dead in October 2021, after minor surgery he was having under general anaesthetic went awry and doctors could not bring him round before his heart stopped beating.

He told FTAdviser he had been left chasing Scottish Friendly for his fee for several weeks at a time of great personal stress while recuperating. 

Simoney.kyriakou@ft.com