An Ontario court has upheld an insurer’s decision to deny a critical illness claim after a policyholder discovered he had cancer within 90 days after buying his policy.
In a decision handed down August 20, the Ontario Superior Court of Justice has denied an application from a policyholder who sought a declaration that he was entitled to critical illness benefits that were denied by his insurer, Great-West Life Assurance Co.
According to the decision, Franco Provenzano bought a $1 million policy from Great-West in June 2011, primarily because of a family history of heart disease. The policy included coverage for life-threatening cancer, but also excluded cancer discovered within the first 90 days. In August 2011, a routine screening test for cardiovascular disease found thyroid nodules that turned out to be cancerous, although the cancer wasn’t diagnosed until February 2012.
Following the diagnosis, Provenzano submitted a claim for the critical illness benefits, which the company denied, relying on the exclusion for conditions discovered within the first 90 days of buying the policy. And, Great-West refunded the entire premium, in accordance with the policy.
The question for the court, was whether the discovery of the nodules amounted to finding cancer within the exclusion period, regardless of when the diagnosis was made. According to the decision, Provenzano argued that the exception does not apply in his case as the original test wasn’t screening for cancer, and that it did not lead directly to a diagnosis of cancer.
However, the court ruled against him, finding that the case fell well within the language of the exception. “It matters not that a sign that may be cancer was discovered during an investigation that was not primarily looking for signs of cancer or that further investigations were required to confirm the sign was indeed cancer,” the decision says. “Working backwards from the diagnosis, none of the intermediate investigations would have been taken had it not been for the discovery of the sign, the thyroid nodules.”
“On the facts of this case, the thyroid nodules were a sign that directly led to the diagnosis of cancer six months later,” it says.
The court says that its interpretation is consistent with the intent of the contract, adding that these sorts of exceptions were made a standard feature of critical illness policies “to address the high incidence of cancer claims experienced shortly after the delivery of such policies.”
As a result, the court sided with the insurer, dismissing the application.