/ Money

Sir, you’ll have to lose another leg for a payout

Ginger bread with missing leg

You’d think your critical illness insurance would cover you if you lost a limb. Little would you know that you’ll need to lose two limbs for a payout. Bus driver Martin Wells faced this very situation…

Over the course of 12 years, Martin Wells paid around £30 a month, or more than £4,500, on critical illness cover with Scottish Widows.

When he had his leg amputated due to infections following a motorcycle accident, he had expected a payout. Instead, he was told that he would need to lose both legs before his insurer would pay.

In Martin Well’s own words, ‘It’s ridiculous. People take these policies out in good faith.’

Where’s the common sense?

Scottish Widows’ policy covers ‘loss of hands or feet – permanent physical severance of any combination of two or more hands or feet at or above the wrist or ankle joints’.

This does seem a little mad – when you take out critical illness cover you’d expect to get a payout if you lost a leg. At no point would it ever come to mind that you’d have to lose another. Surely losing just one is “critical” enough?

Common sense is completely lacking. And when you read the latter part of the policy’s terms, it appears that if you lost both your feet below the ankle joints you also wouldn’t get a payout.

However, Scottish Widows has pointed out that the company was following standard practice. A spokesman commented:

‘Under the Association of British Insurers loss of limb definition, adhered to by Scottish Widows, a critical illness policy only pays out when two limbs are lost.’

It seems that if you want to cover yourself for the loss of just one limb you’ll have to take out enhanced cover. However, if the exceptions of your original policy aren’t made clear when you sign up, how are you to know that enhanced cover is necessary? Plus, who would think to ask such a question before they signed on the dotted line?

Read the T&Cs

Our insurance expert Dan Moore comments:

‘This story highlights the problem with critical illness cover – it is not a catch-all solution. The policy would state the loss of more than one limb, but whether this was clearly explained to the customer when he was looking to take out the policy is another matter.’

Dan has previously written about insurers cancelling cover after someone has been diagnosed with cancer. Martin Wells’ case looks like another example of where insurers aren’t playing fair – or are at least being counter to common sense.

So, my advice to you is; carefully read through your policy’s terms and conditions before you find yourself up the creek without a paddle – or an arm to use it.


For many years I have believed that we need insurance to cover things that the average person would assume they are covered for.

Few of us have the time to read all the terms and conditions we encounter but everyone really needs to study insurance cover or risk facing a nasty surprise. Nowadays, insurance companies provide detailed, clear information about what is covered. Private health insurance is full of surprises, and the cover can change, for better or worse, from year to year.

I have every sympathy for Mr Wells’ situation, but it is fundamental to any contract of insurance that the insurer will limit the circumstances where a claim has to be settled and manipulate the risks in their favour to make more profit.

In essence, insurance is no different from placing a bet with a bookmaker. Are you prepared to bet you will crash your car this year? Your employer will make you redundant? You will die before you’ve paid off your mortgage?

The difference is that you are speculating about events that may befall you, rather than some external event. And this is where the concept of “good faith” applies. You know far more about your personal circumstances than the insurer; so there is a duty on you to disclose all material facts and not mislead.

Given this disclosure takes place, the odds of particular events actually happening are well know to the bookmaker (known in the trade as an “underwriter” or “actuary”), less well so to the punter (sorry, “the Insured”). And by devising products with a combination of risks, insurers make it harder for the public to assess the value for money of their offerings. Critical Health Insurance is the ultimate in this regard, so let’s consider a simpler example; travel insurance.

You are probably willing to bet £20 or more that, over the course of the next 10 days, you and your family will have your flights cancelled, your luggage will be stolen and you will fall ill or have an accident requiring hospitalization. (If even one of those events was actually likely to happen who, in their right mind, would ever go on holiday?)

Insurers sell their products on price – hence the popularity of the comparison websites – but you need the eyes of a hawk to spot the limitations and exclusions that improve the odds for the insurer. Or can you just assume that because you’ve paid more than £20 you must be covered for any and every contingency and circumstance that could ever befall you on holiday? Of course not, so does this make travel insurance unfair?

Consumers need to understand the true nature of insurance, and use the same care and attention to detail that they would apply when betting on a white Christmas. “I’ve won! It’s snowing.” “Yeah mate, but not in Cairo!”

Good points Em. I like the comparison with gambling.

Obviously the insured has the responsibility of checking their insurance cover, and my limited experience suggests the insurance industry is doing a good job in providing clear information.

Ideally, Martin Wells should have been the option of choosing cover for loss of one limb or two, and the cost difference. Websites are ideal for presenting us with a wide range of options that we can consider with care and with regard to costs.

Until the customer can specify exactly what cover they want it is difficult to establish which company offers the best value for money.

The Insurance Industry’s functioning has become corrupted as it is directed by biased accountants protecting their own interest through call centres . This is with the Government & Regulators employing the same administrative structure the call centre with each one copying the other with undemocratic rip off procedures.If one raises issues they set you up as a vexatious litigant by their dubious complaints procedures They are using the unqualified on remits to make medical, legal decisions on corporate remits via GPs. The GPs who are also directed by the corporate in LAs/ PCT via contracts. I had 3 policies with a company that sponsors a certain TV programme but refused to let me claim though deliberately used information to market . So I could not get a second opinion initially which contributed to cardiac arrest . They then abandoned taking monthly payments with Financial Ombudsman allowing them to take the payments for a year never reimbursing or investigating fairly even though had a legal expert witness .This has happened over 10 times with Ombudsman often taking side of underwriters or those that pay them.

Mark Smith says:
29 February 2012

In my experience I find the life insurance policies and critical policies are delibrately designed to take payment and no pay out when your in a position to make a claim. Surgical precedures are being changed with modern technology and the policies are written do no reflect that change. Heart Attack is a Heart Attack but in the wording or definitions the insurance company baffles you with science. You usually find one part of the policy will take you to one page then another page then if this does not equal to that go to that page. In other words designed to annoy you then give you a full explanation of your entitlement. I believe all insurance policies are being missold. Good thing now is consumers can do their own research via the internet.

I remember that song ” Money For Nothing ” Dire Straits

Ryan Tymon says:
10 April 2012

Im a trainee financial advisor and see this day to day. If anyone wants to take out either Life cover or Critical illness then speak to an advisor. There are so many different Providers out there such as Scottish Widows or FriendsLife, In my opinion the best Critical Illness provider out there at the moment is PruProtect, They provide up to 161 ABI Definitions. You will not usually pay for this advice as it is commision based and for advisors like myself it gives me the oppurtunity to assess other financial aspects such as pensions or mortgages.

can anyone help me, I took an critical illness cover when i took my morgage out as i was a single parent and as my advisor told me there was only one income coming in. 5 years ago I was diagnosed with breast cancer (DCIS) consequently had a full mastetomy and radiotherpy in the small print of the policy its say does not pay out insitu, I feel I was missold has I was covering all inventualities I am still paying the £15.51for the remaining of the policy and legal and general who the cover is with ,will not give me life insurance, cant win.

Hi Ann. Sorry to hear about your experiences. I’ve checked the L&G policy wording and you’re right that it does exclude DCIS. However, I’m not convinced that the average person would know when taking out the policy what that actually means (I had to Google it), so someone should have explained it at the time.

I’d suggest that you complain to whoever advised you and sold you the policy, explaining that the exclusions weren’t explained at the time and that you’ve subsequently lost out financially. If you don’t get a satisfactory answer, you could complain to the Financial Ombudsman Service (FOS). Details are in this guide: http://www.which.co.uk/consumer-rights/action/when-to-take-a-complaint-to-the-ombudsman/?a=how-to-complain-to-an-ombudsman

The problem you may face though is whether you’re within the time limits to go to the FOS. Usually you need to lodge a complaint either within 6 years of the policy being taken out or, if later, within 3 years of becoming aware of the problem. It’s not clear from your message whether you’re within the 6 year limit, but it’s still worth complaining to whoever sold you the policy.

We think insurers’ terms and conditions should be very clear about what is and isn’t covered under a policy, including the use of clear and unambiguous language – we’ll continue to work towards this by exposing bad practice and engaging with companies and regulators. Do let us know how you get on.

Kitty says:
10 August 2014

Hi was just reading your post and although my problem is not exactly like yours I have DCIS and have found this is excluded, Have you managed to have your issue concluded?

Molly says:
11 August 2014

My problem is as follows I was diagnosed with Breast Cancer DCIS which resulted in a mastectomy. Having received a call from a marketing agency on behalf of Scottish Widows I was advised I had critical illness cover which I was not aware of. I contacted Scottish Widows who confirmed the above and accepted a claim. They took details of my consultant and wrote to them. I checked the online policy for critical illness which confirmed DCIS was excluded unless surgical mastectomy had taken place. However, my policy was refused as they state my original policy excluded DCIS. I did not know I had critical illness and did not receive a policy document. Although ignorance of the fact cannot be held against me how can they update a policy but not all? Oviously I will take my complaint to the Ombudsman but is there anything else I should be doing.

Hello Molly

It sounds like you’re following the right path – although it’s important to be aware that before the Ombudsman will take on a complaint, you must first have complained to the company yourself, and given them eight weeks to resolve it to your satisfaction. If you haven’t done this, we’ve got some advice on how to go about it here: http://www.which.co.uk/consumer-rights/action/how-to-complain-to-a-company

Unfortunately, Scottish Widows may not have to honour your claim, as there isn’t a requirement for insurers to update cover on older policies to match what they offer on new ones. Where insurers offer policies with different benefits, the pricing and underwriting will generally differ too.

However, it sounds like you were provided with no information about what your policy actually did cover, or even that you were buying it. Insurers are supposed to be clear and upfront about these details, so you should certainly pursue your complaint – bringing in the Ombudsman if necessary – to establish precisely what went wrong.

Please let us know how it goes.

Manpreet says:
20 February 2015

Hello Molly, I am in slightly similar situation with the bus driver and your case. Scottish widow has updated their policy to include loss of one limb and one foot in 2014 but they are saying it is not applicable to my policy. Can you please update what was the outcome of your complaint to ombudsman.

Colin says:
4 May 2013

I am currently trying to a claim my critical illness insurance
As I was diagnosed last year with bowel cancer. The policy
Is with Scottish Provident. I had epilepsy 30 years ago and I
Over looked this when I took out the policy 3 years ago. Scottish
Provident are now questioning this.
Is it likely I will not get paid out for this over site

nigel says:
3 December 2013

I recently had a cardiac arrest I ended up in intensive care unit for 4 weeks 7 weeks total in hospital , had my critical illness claim turned down by Scottish widows. They are willing to take your money, but don’t like paying a claim. going to take it further.

Jules says:
9 March 2018

Did you succeed in your claim in a similiar situation now.,

Lorna says:
3 June 2014

I had bacterial meningitis and sceptacemia at the beginning of this year. We have had critical illness policy with Scottish provident since 2001 paying £70 a month. We sent our claim in at the end of January 2014 the only consultants name we had on our hospital paperwork was the discharging consultant who as it turns out was in fact a diabetes consultant. SP wrote to the consultant for information regarding my illness and even though she hadn’t examine me she answered their request stating there was ‘nothing wrong with me!’ Based on this information they refused my claim. We started the appeal process at the beginning of April and we are still waiting for a second decision. The policy states ‘permanent neurological deficits’ this has been stated in my doctors report and the surgeons report who amputated my toes. I have numbness in my foot and sensitive toes (the ones remaining) I have also had hearing aids fitted due to hearing damage. If it is declined again where do we go from here. This policy was taken out as we are both self employed and we didn’t want the financial stress and worry if we became ill. Exactly what we have had for the last 5 months as I am unable to run my cafe due to my amputation of the toes.

Manpreet says:
20 February 2015

Hello Patrick, Do you the outcome of leg amputation? did he complain to ombudsman ? I am in a similar situation. My daughter had her one leg amputated but Scottish widow is refusing claim whereas they made changes in 2014 and state loss of one leg or one foot. They have told me these changes are not applicable to old policies. can they do it? any advice please ?

Leanne says:
16 June 2016

Can anyone help us, we took out critical illness insurance with Scottish widows 22years ago when getting our mortgage. Paid it faithfully (a small fortune) and 5years ago my husband was diagnosed with a very rare condition called castlemans disease. He has recently been made redundant and can’t get life insurance. Previously he had life insurance through his job. We have tried numerous specialist firms and no one will take him on. Recently we made a claim on the Scottish widows policy and have been turned down today because castlemans is not an official form of cancer although it behaves like cancer and causes lymphoma among other things, and according to them he doesn’t have infiltration to other cells. He has tumours in the lymph nodes in his neck, groin, axillia, and whole left side of his aorta. He has had two surgical procedures to his neck to remove rumours also. We have seen specialists in London also. Life expectancy with this condition is 5years. We have paid this faithfully and are very angry that this has been turned down. What options are open to us now.