Scared to death by missing life insurance

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