Scared to death by miss­ing life in­sur­ance

Toronto Star - - NEWS - Martin Regg Cohn

The wise po­lit­i­cal colum­nist gives his read­ers a break from pol­i­tics now and then. To­day’s col­umn is about some­thing com­pletely dif­fer­ent: How my life in­sur­ance com­pany scared me to death.

No, it’s not a story of self-plead­ing (all is now solved and re­solved.) It’s a cau­tion­ary tale for you, dear reader (and dear in­surer) about how call cen­tres wield so much power over us. Even on mat­ters of life and death. And how cor­po­rate poli­cies pre­clude the ex­er­cise of in­tel­li­gent dis­cre­tion, not merely out of com­pas­sion but com­mon sense.

The trail be­gins with a pay­ment go­ing astray. We had al­ready re­mit­ted our an­nual pre­mium through our bank (CIBC). But the in­sur­ance com­pany (RBC In­sur­ance) wasn’t buy­ing it.

Ex­hausted by the call cen­tre runaround, I fi­nally came up with my own work­around for this episode of dou­ble trou­ble: I made a dou­ble pay­ment — a quintessen­tially Cana­dian dou­ble dou­ble — as “in­sur­ance” to keep my life in­sur­ance pol­icy on life sup­port un­til a fi­nal ac­count­ing could be made.

The scary part came in a let­ter last month claim­ing the an­nual pre­mium “re­mains out­stand­ing,” in­clud­ing this blunt warn­ing: “If pay­ment is not re­ceived by Oc­to­ber 6, 2017, your pol­icy will lapse and sat­is­fac­tory ev­i­dence of in­sur­a­bil­ity may be nec­es­sary to re­in­state your in­sur­ance pro­tec­tion.”

Hmmm. The whole point of sign­ing up a decade ago, when I had young chil­dren to worry about (and my own mid­dle-ag­ing body to think about) was pre­cisely to avoid hav­ing to pass another med­i­cal exam all th­ese years later. Back then I was the pic­ture of good health, but I chose a costlier 20-year term be­cause who knows when you’ll run out of med­i­cal luck?

I phoned the dreaded call cen­tre to pro­vide proof of pay­ment from my bank, in­clud­ing the ref­er­ence num­ber. But when I re­quested an ex­ten­sion on the dead­line for ter­mi­nat­ing the pol­icy — given that I could prove pay­ment — the agent said it couldn’t be done.

She promised to fol­low up within three days (I had to call again), but still no luck. A su­per­vi­sor con­firmed they would not ex­tend the drop dead dead­line for my life pol­icy, and that there was still no trace of my money.

They de­manded more proof. As in­structed, I marched off to get the teller’s re­ceipt — con­tain­ing the very same ref­er­ence num­ber — and emailed it in with de­clin­ing con­fi­dence.

That’s when I dreamed up dou­bling up on my an­nual pre­mium. Ul­ti­mately, both pay­ments showed up — the orig­i­nal one sent a month ear­lier, and the sec­ond one that I’d just sent — in time to keep my life in­sur­ance pol­icy from dy­ing.

But how could this hap­pen? It turns out that RBC In­sur­ance has four sep­a­rate cat­e­gories for tell­ers (or on­line bank­ing cus­tomers) to se­lect when mak­ing a pay­ment, in­clud­ing: Home and Auto; Group; and In­di­vid­ual.

It ap­pears that our own bank teller at CIBC sent our money to the first cat­e­gory, rather than the last one. CIBC spokesper­son Caro­line Van Has­selt told me they rarely hear about pay­ments go­ing astray de­spite high vol­umes, but they en­cour­age cus­tomers to keep a record of all trans­ac­tions and to con­tact the bank for help “and we will do our best to help make it right.”

But in this case, there was a trans­ac­tion trail — proof of where the money had gone. RBC In­sur­ance told me peo­ple some­times mix up the dif­fer­ent cat­e­gories, es­pe­cially group ver­sus in­di­vid­ual life, but also home in­sur­ance.

An in­no­cent mis­take, but surely it’s all the same com­pany, un­der the RBC um­brella? Not so, as I dis­cov­ered when I put on my jour­nal­ist’s hat to seek an ex­pla­na­tion.

Randy Singh, se­nior man­ager of cus­tomer care at RBC In­sur­ance, told me his com­pany also works with another com­pany, Aviva Gen­eral, which pro­cesses home and auto pay­ments separately. That’s why “from time to time” a cus­tomer’s money goes un­seen for a time by RBC.

“Be­cause we’ve seen this in the past, we do have a process whereby our life in­sur­ance pol­icy ac­count­ing depart­ment . . . try to make it easy for our clients.” But in some cases, “it’s not very timely, so in other words, it’s a rec­on­cil­i­a­tion at the end of the month — we’re tak­ing a look at any pay­ments made that should have come to RBC Life but were di­rected to Aviva,” he ex­plained.

“So in this case, with a mat­ter of a few days, and the clock is tick­ing, un­for­tu­nately, it did take a lit­tle bit more time . . . we did ac­tu­ally find the pay­ment.”

But there’s one thing that can’t be fixed af­ter the fact: If you die when you’re tem­po­rar­ily un­cov­ered, RBC won’t pay out any ben­e­fit even if the pol­icy is later re­stored and the client paid in good faith, Singh con­firmed.

My sit­u­a­tion was a clas­sic case of the left hand not know­ing what the right hand had in its pocket at RBC In­sur­ance. And my fam­ily would have been dou­bly un­lucky (los­ing me and my life in­sur­ance) if I hadn’t dou­bled up on the pre­mium just to be safe.

RBC later mailed a re­fund for the backup pay­ment. But there was no apol­ogy in the en­ve­lope, only on the phone when I per­sisted. That’s the beauty of the life in­sur­ance busi­ness.

They only have to earn your busi­ness once when they sell you the pol­icy. But they keep col­lect­ing, year af­ter year, with­out ever wor­ry­ing about los­ing you as a cus­tomer un­til you — or the pol­icy — ex­pires a decade or two later. Martin Regg Cohn’s po­lit­i­cal col­umn ap­pears Tues­day, Thurs­day and Satur­day. mcohn@thes­tar.ca, Twit­ter: @reg­gcohn

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