Good day.Recently I got a new job, previ...

Asked by Mologadi Maropola on 03-08-2023 10:38:50
Question posted in the Insurance Law category relating to North West

Good day.

Recently I got a new job, previously I was an ocuupational hygiene assistant (occupational environment observer was the actual job title) at a gold plant. it was a surface job meaning i didnt go underground. I took out a life insurance policy two years ago with Liberty with the assistance of a fiancial advisor when i bought a house. This year when i got a the new job my job changed to Ventilation officer (Assistant occupational Hygienist the job title) this time an underground job.

I had contacted my FA to assist with restructuring my fiancial affairs. I wanted a Bond/credit life cover for the house, that would be separate from my personal life insurance. I wanted a life insurance policy that i wouldnt be forced to cede to the bank as well a very spefice product, Sanlam that i had previously gotten a quote for. but i wanted to make sure that i could get proper bond/credit life insurance before ammending/cancelling the policy with Liberty.

As a summery

i got a quote for Sanlami wanted my FA to get me a good bond coverthen i would cancel Liberty

My FA expressed concern that about the fact I work underground (i already had a quote) and proceeded to look for products

She used the wrong occupation and not the occupation that i gave her when sourcing quotes for me. she didnt need to get me life insurance quotes because i had already told which product i wanted as well my reason , though i never told her i had already gotten a quote.

she came back to me with this information

she cannot get credit life/bond covershe cannot get the life insurance cover that i want 

Citing that working underground is the source of this difficulty. I informed her that she used the wrong the occupation on the quote and that should have used the occupation i gave her. she said she had use an appropriate occupation to reflect my risk, and that the problem isn't the job title but underground

I sent the Sanlam quote 

she got the Liberty to match it

I accepted the Sanlam quote. 

She expressed that Sanlam cannot properly cover me as i work underground because Sanlam doesnt cover my occupation

I told her that I had used my actual occupation (ventilation oficer) as the basis for the risk, she insisted it wasnt a proper reflection of risk. 

I enquired wih Sanlam

Sanlam cancelled the Policy because i had been previously denied insuance and not because my occupation isnt covered

I want to sue her for the value of the policy that i lost because she created a problem where there wasnt a problem, ignored the occupation that i gave her and inflated my level of risk to there point where i now cannot ever get insurance becuase having been denied cover makes it very hard, and with a policy having been cancelled it is all but imposible to get cover. Had she used the occupation i gave her, none of this would have happened. 

Do I have a case?

Message from the Lawyer

Posted by Att. Patrick on 03-08-2023 12:13:08

Hi there and thank you for your question,

I am a practicing attorney based in South Africa and I will assist you with your question. Please feel free to ask as many follow up questions in order to clarify your question. If you have a new question, you must please open a new thread.

Please keep in mind that our discussions is for general information purposes only. Our engagement on this website does not create an attorney-client relationship. 

I think that you would have a claim against her.

But my concern is how you would formulate the quantum of the claim because you might never need to rely on the insurance policy in the event that you pay off the bond while you are still alive. Then the policy would no longer be needed. 

I think that your claim would probably be formulated by getting life insurance from another company, at a higher premium, and then suing her for the difference between the higher premium and the premium that you would have paid had the broker not messed things up.

I completely agree that she should have acted in accordance with your instructions and used the information that you gave her. If she was concerned that the risk profile was not correct, then she should have advised you of this but continued to act in accordance with your instructions. 

I think that it you re-calculate the claim to sue her for the difference in premium, you might find that it is not worth hiring a private attorney to sue her because those costs might be steep. 

But I do think that you have a claim against her. 

Message from the client

my major concern is that the insurance policy that was cancelled was
life R2.5M
disability R1.5M
income protection R15k
critical illness R1 M

The purpose of this policy was to protect myself and my loved ones against these eventualities. at least one of these things would happen as well at the additional wealth bonus, in case none of I happens. now all lost.
Further more, you cannot get insurance if your policy was cancelled especially for a non disclosure. meaning its all permanently lost. I would use the cover amount as the quantifiably lost amount. Assuming that I died and got a payout that is what my estate would have been worth. Especially that is policy was not ceded to the bond, it was separate.

Message from the Lawyer

Posted by Att. Patrick on 03-08-2023 12:53:22

Okay, so what you've explained makes complete sense. But I think that it is based on the assumption that you will NEVER get life insurance again. I think that you should test this assumption by trying to get further quotes. If they are all refused, then this will be good evidence that you can use in court. You should also be asking the question as to whether you might be able to get a quote in the future, like in 12 months time. Or, will you NEVER get life insurance again because of this. 

If you would like to view the entire answer, you will need to either login or register a FREE account.


DISCLAIMER: Advice or answers from Lawyers on South African Legal Advice are not substitutes for the proper advice of an Lawyer. South African Legal Advice is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Lawyer who assists with your question is not your Lawyer, and the response above is not to be considered to be legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains. The responses above are from individual Lawyers, not South African Legal Advice. The site and services are provided “as is”. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service.