Pre-existing Illnesses - Shield Plans(1)

Someone emailed me recently to seek my opinion about Pre-exising Illnesses for her Shield Plan. She was advised to switch out from Aviva Myshield to GE SupremeHealth. The adviser claims that she was in a vulnerable position due to Aviva's definition about "Pre-existing Illnesses".

I replied to her that she should look into other benefits in the long term other than this "Pre-existing clause. It is a bit too extreme to say that she is in a vulnerable position just because of the "Pre-existing Illnesses" definition.

a) Her policy was already been inforce for several years. It is very difficult for the insurer to prove that a Pre-existing condition exist prior commencement of the policy. If the insurer is to refuse the claim, they have to prove this point.

b) It is not the responsibility of the insurer to refuse a claim when it happens. The pre-existing condition clause was present to largely protect the pool of policyholders against anti-selections. Every claims should be viewed objectively with this in mind.

c) Aviva have around 100k+ policyholders for their Myshield Plan and is known to make around 5,000 claims per year. It is not heard of many cases whereby Aviva rejected claims purely based on Pre-existing illnesses.

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Patrick Lim - http://www.patlim.blogspot.com/ wrote about it in sgfund forum and I like to share what he found out from Aviva when he asked about the "Pre-existing Illnesses" issue.

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In determining whether a condition is 'pre-existing', Aviva will determine whether there is a clear clinical association between the condition being claimed for and the clinical manifestation, diseases that may have occurred PRIOR to commencement of the policy.

If NO, the claim will be payable. At claims stage, all assessments will be made objectively based on medical reports obtained. When a policyholder develops a medical condition after inception of myshield, our approach for the 3 scenarios quoted will be:

Scenario 1
If this is not known to him/her? We will ascertain whether his/her condition would have originated prior to policy commencement regardless known or unknown to the claimant. If yes, claim will be rejected.
If no, claim will be paid.

Scenario 2
After a short time on inception of the policy?
Duration of policy commencement may not be the key basis to reject claim. We will ascertain the possible onset / duration of the illness in comparison to policy duration.
However, early claims could be easily supported as compared to policy which has been incepted for many years.

Scenario 3
Donkey years after inception of the policy?
When the policy has been incepted for many years, it would make clinical evidence difficult and most of the time we would admit if there is no symptom or treatment rendered prior to policy commencement.

Lastly the question on 'under what scenarios will Aviva admit and pay claims on pre-existing conditions', we will adopt the two broad approaches:
(1) If it is a proven pre-existing condition for 'New' policy, we will reject. But if medical information is inconclusive, we will give benefit of doubt to the policyholder and pay the claim.
(2) In the case of 'Takeover' policy, if such pre-existing condition/s would have been covered under previous Shield coverage (except MediShield), Aviva will pay.

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