Rescission, in the insurance industry, is the practice of voiding the contract between the insurer and the policyholder when the policyholder would otherwise be due some money. I’ve been watching horrible tales of this practice in the US for a while and smugly telling people that we don’t have those problems here in NZ.
Well, our health insurers have learnt some lessons from the US apparently. Terminally ill Wayne Croft has had his policy cancelled because (the insurer alleges) he didn’t declare some pre-existing health conditions (all of which are minor, none of which relate to his cancer at all). Croft says he never tried to hide anything and did his best to be upfront. The icing on this sad cake is that Croft only recently switched insurers, because he was promised a better deal at Sovereign than he had at the other place where he had initially taken out insurance as an 18-year-old.
Crucial difference between here and the US: our public health system is still intact. That doesn’t make this any less reprehensible.
It’s clear to me that the insurer bears much more responsibility than they’re prepared to admit. They have all the power in the relationship, and that should properly impose responsibilities upon them. One form with a “declarations” box is simply not sufficient to claim due diligence has been performed, not when the stakes are this high for the policyholder. Forms are distinctly user-unfriendly, and lend themselves to distortion and omission even with goodwill and diligence. Sovereign has acted appallingly, and I hope the NZ public send a clear message to Sovereign and the health insurance industry that this is not acceptable behaviour in this country.
(It was satisfying to watch John Campbell go attack-dog on the Sovereign rep on his show last night. I watch Campbell about once a year, if that, and this was a good night to pick.)