Case Study – The Importance of the Date When Diagnosed with Terminal Illness


In this claims case study, the adviser shares how he was able to secure an additional benefit for his client, based on the date on which their illness was first diagnosed.


At a glance

Provided by: Robert Bonifacio, MDRT member
Business: Essential Financial Services
Licensee: Charter Financial Planning
Clients: Bob and Mary*
Claim type: Life


In detail

Bob and Mary* had been clients of Victorian adviser, Robert Bonifacio, since 2005.

In June 2011, Bob, who was aged 68 at the time, approached Robert, asking to reduce the amount of his life insurance cover. He explained that his ill-health meant he was no longer able to work full-time, and as a result could not afford to pay for all the cover he and his wife Mary needed. Robert made the necessary changes to the cover.

Less than a year later, Bob was diagnosed as terminally ill. Robert lodged a claim for Bob on his life cover, which was paid out in advance of his death.

Robert said that Bob and Mary had originally planned to use their life insurance benefit to pay off their mortgage debt. “However, they decided to use the money to do the family things they had always wanted to do before Bob passed away.”

Sadly, Bob died on 19 June 2012.

As part of his advice process, Robert and his team subsequently made enquiries with Bob and Mary’s insurer as to whether they were entitled to an additional life insurance benefit payment. “You see, in our view, Bob was terminally ill before he reduced his life cover. He just didn’t know that at the time,” explained Robert.

After a thorough investigation the insurer, AIA Australia, concurred with this assessment, and agreed to pay out the full benefit for which Bob had originally been insured, before he reduced his cover in 2011.

The additional payment (which doubled the original pay-out) was hand-delivered by Robert to Mary: “It was our pleasure to meet with Mary and deliver a cheque she was not expecting.”

“In this day and age we don’t often hear all the good things that happen above and beyond the call of duty,” said Robert.

*Clients’ names have been changed to protect their privacy