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Published: 8:03PM Wednesday May 12, 2010 Source: Fair Go

Reporter: Hannah Wallis

If you've got life, mortgage or health insurance - or you're thinking about getting it - Fair Go's got a warning. We've had a lot of complaints over the years about how easy it is to make mistakes when you're filling out those insurance forms - mistakes; ommissions; ticking the no box when you should've ticked yes; misunderstanding the questions. The rules of insurance say that a company can invalidate your insurance if you have failed to disclose anything which, in the company's opinion, changes the risk they take on when they take you on as a customer.

Our story tonight centres on Marlene Henry, who took out life insurance to make sure her children Chanel and Seth were looked after if the worst should happen. It did, and Marlene died of cancer 18 months ago. But her insurance company, AXA, said that when Marlene filled in the forms, 10 years ago, she didn't disclose that she had bipolar disorder. She didn't die from mental health issues, but AXA argued that had they known, she would've been a greater risk, and they would have either charged her more premium or given her much less than the amount for which she was insured. And they invalidated her policy - no payout.

We're pleased to say that following negotiations between Chanel, AXA and Fair Go, the insurer has agreed to pay a confidential amount. Marlene's children say they're very pleased with the settlement.

So - how can you safely fill out those forms and make sure you get the cover you need?

1: Be really careful if you end up applying for insurance at a bank - these people are trained as bankers, not as brokers.

You are also likely to be at the bank for a different reason - re-financing, re-mortgaging etc. - not ideal conditions to be suddenly dealing with an insurance application.

2: Don't be rushed into filling these forms out on the spot - with either a banker or a broker. They are significant documents and to fill them out completely accurately, you need time,  and probably access to other information like medical notes and family medical history. Take them away for a few days and get any expert help you need filling them out.

And never tick yes or no if you're not sure about anything, and can't find out - write in "don't know".

3: Wording to be particularly careful about:

Be careful of split questions, where you may see the first part and miss the second, and look out for the word "or"  - as in - "have you been hospitalised in an emergency or for special treatment or surgery, or suffered any other problems which required or may require further investigation, treatment or medication "

Be super careful when a question contains a long, complicated list of unrelated conditions  - it's very easy to miss something you should have mentioned.

Look out for wide reaching terms like "skin complaint" or "stomach disorder"

If you come across confusing medical terms - make sure you find out exactly what the insurer means e.g. medical examination means - visiting your doctor.

4: Be very careful about questions about seeing your doctor, or getting various tests - check with your GP or specialist before answering.

You may not be aware of everything that's contained in your doctors notes - and those notes can end up as the basis of turning down an insurance claim. For instance, who hasn't been to the doctor for one reason, but talked about a secondary condition when you get there? You may remember the first reason for the visit and not the second - but the doctor will have that in the notes. Or, you mentioned in passing that you were feeling a bit down, or blue - the doctor writes down "depressed" - and that's suddenly a diagnosis and could affect later claims.

5: Beware of questions about family health, inherited conditions,. It's almost impossible to get these correct without checking family members, and they won't always tell you the truth - some health conditions they may want to keep to themselves.If you can't be sure, again, put "don't know".

6: In general, be very careful about not mentioning things you would think of as insignificant or unimportant. There's recently been a case where a woman didn't mention she'd had a benign breast lump - her doctor told her it was just fatty tissue, she had it tested and it was, and they discussed having a mammogram in the future.  But, she was later refused insurance cover because she went on to develop breast cancer. The insurance company argued that they would have treated the benign lump as significant and waited for further tests before deciding on the insurance cover.

7: And if you already have insurance, and are worried about how you answered the questions, or about any condition that might have developed since - tell you insurer. Better to do that now, than risk losing the entire cover when claim time comes.

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