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The Ombud for Long-term Insurance received a record number of complaints in 2018, most of which were about funeral benefits.
In one such case involving a funeral claim for a stillborn baby, the insurer had, for instance, unfairly refused a R1 000 payment until the OLTI intervened.
The OLTI said it also relied on fairness in instructing an insurer to pay a funeral claim on the death of a second cousin, who had been described as a cousin by the complainant. The Ombud ruled that the term "cousin" includes second cousins in certain languages and cultures.
The OLTI received 11 768 written requests for assistance in 2018, which was an increase of 1 000 requests compared to the 10 768 received in 2017.
Of those requests, 5 978 were chargeable complaints which fell within the Ombudsman's jurisdiction – this was an increase of 10% compared to the 5 435 chargeable complaints received in 2017.
"OLTI set a new benchmark, with 91% of complaints finalised within six months," said Ombudsman Ron McLaren in a statement.
This was achieved despite the fact that complaints are becoming increasingly complicated to resolve, according to McLaren.
In 40% of complaints there was relief for complainants. Payments in lump sums to the value of a total of R185.8m were recovered for complainants. Compensation of a total of R632 737 was awarded to 160 complainants for poor service by insurers.
One of the cases handled during the year was the Momentum/Ganas case, where the Ombud ruled in favour of the insurer. However, Momentum later agreed to pay the claim on the accidental death of Mr Nathan Ganas, despite the non-disclosure of a pre-existing medical condition at the application stage.
The Ombud, therefore, recommends that the legislature should reconsider the current non-disclosure legislation.
Another trend noticed during the year is an increasing awareness on the part of complainants to ask for compensation for poor service.
"A common misconception by complainants is that the amount of compensation should equal the policy benefit in question," said the Ombud.
Complainants also often express the misguided wish that the insurer should be punished by the compensation award, he added.
