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Beware of funeral policy surprise

Fin24 user Brian had a rude awakening regarding his wife's funeral policy. He would like to help other consumers avoid a similar situation and writes:

I would like to share my experience with others out there so that they don't have the same problem.

My wife had cancer and she suffered for years while getting treatment.

About a year ago she knew that the treatment wasn't going to work and she took out life and funeral policies with a supposedly reputable and ethical insurance company.

My wife passed away recently and we then approached the insurance company to pay out the funeral policy.

At first they claimed we would be paid out within 24 hours, this then became 48 hours and so on.

They then gave us the run around, telling us they hadn't received the required documentation, copies were too dark and so on.

We eventually submitted the documents four times via email and fax.
At one stage they even requested three months' bank statements of my wife's bank account.

When I enquired why they needed this, they couldn't provide a logical answer, merely that it was a requirement.

I told them that I couldn't provide the statements as the account had already been frozen by the bank.

They then insisted that I must provide them with three months' bank statements from my account. I explained to them that this was also not possible as my wife and I had a joint account.

They then decided that I could use my daughter's account, but she must also provide three months' bank statements.

We supplied this and waited.

They then decided that this wasn't acceptable and that I had to complete an affidavit stating that the money could be paid into her account.

The waiting game

To reach this point had now taken two weeks and all the time being required to deal with downright rude and obnoxious staff, who either never answered calls or did not return them.

Finally, they decided to call me to inform me that they rejected the claim as the policy stated a one year waiting period for death by natural causes.
The policy is a month short of this.

I asked them why it took two weeks to decide this when they had the death certificate, which clearly stated "natural causes".

I got the usual line of "they had to follow procedure", which means that they just enjoy messing people around for as long as possible, while knowing that they wouldn't pay out.

I informed them that this was outrageous and surely they could pay a pro rata amount out.

They refused and told me if I didn't like it, I could approach the insurance ombudsman and that they would not do anything further.

I have lodged a complaint with the ombudsman, but I'm not holding my breath waiting for anything to happen there.

My warning to everyone out there is to carefully check what the policy says related to payout for cause of death, documents required, payout time frames and length of policy cover.

Make sure this is in writing. Don't believe anything that a consultant tells you regardless of how nice they might sound.

If possible, get a lawyer to review the contract before you commit.

When the consultants contact people, they make all manner of promises to people full knowing that they cannot fulfil those promises.

They really don't care, as they are only concerned about the commission they will make.

The insurance industry is riddled with unethical operators so don't be fooled that having a policy with a "reputable" company is any guarantee that they will act in a professional and ethical manner.

When someone dear passes away it is a traumatic event and then being required to deal with unethical, rude people at an insurance company is just too much.

- Fin24

Have you had a bad experience regarding a funeral policy? Let us know.

Disclaimer: All articles and letters published on MyFin24 have been independently written by members of the Fin24 community. The views of users published on Fin24 are therefore their own and do not necessarily represent those of Fin24.

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