Funeral plans and part-time students.
Insurers say that insurance for a part-time student and funeral plans cease at age 21 unless you can prove that the child was studying full-time. Be careful to note the wording of the policy – a full-time student.
In a case brought before the Ombudsman, the daughter of the policyholder was killed in a car crash when she was twenty-one. The parents lodged a claim and used the Certificate of Symbols that had been given to them by the Education Department as proof that she was a learner.
Unfortunately, while the document confirmed that she was studying towards her Grade 12, it also stated she was doing so part-time. This gave the insurer legal cause to decline the claim. This was legally correct based on the evidence produced by the insurer at the time.
Part-time Student and Funeral plans
The ruling at the time was that the company had acted correctly. The feeling was that the policyholder had not provided enough evidence to the effect that the child was a full-time student.
The Ombudsman ruled that the insurer should make a payment in good faith of half of the amount claimed.
- Despite what was typed out on the certificate, it could not be assumed that the child was studying part-time. In fact, it would be difficult to do so through a school. What the father should have done, was to go to the school and get the proof there.
- The onus would have been on the insurer to prove that she was not a full-time student. The certificate did not constitute actual proof. They should have confirmed this with the school rather than relying on the certificate.
- The fact that the child was trying to improve her marks and the wording of the complaint indicated that she was planning to study full-time. Had she lived, she would no doubt have registered at a college on a full-time basis. She would thus have qualified the next year in terms of the rule the insurer upheld.
The outcome was that the insurer decided to accept the advice. They paid out half of what was originally claimed, without admission of any wrong-doing.
Overall, it was a happy ending for all. The father got money and the insurer acted in good faith. While, in legal terms, they need not have paid the money, it was moral for them to do so.
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