Court affirms rejection of former cabinet minister’s cancer claim

Judge sides with insurance provider, citing claimant’s ill-timed decision relating to his coverage

Court affirms rejection of former cabinet minister’s cancer claim

Former deputy prime minister John Manley has lost a legal battle against Manulife Financial, from which he sought to claim $500,000 in relation to a cancer diagnosis that he received only weeks after cancelling his critical illness coverage.

As reported by Andrew Duffy and published on the National Post, the now-70-year-old Manley was found to have kidney cancer in May 2017 during an ultrasound that was performed to assess another condition. At the time, he was president and CEO of the Business Council of Canada; since then, he has received treatment at The Ottawa Hospital and has recovered.

Following the diagnosis, he filed a $500,000 insurance claim with Manulife Financial, which the company rejected. Since December 2009, Manley had paid premiums for critical injury insurance coverage, which had been a special addition to his term life insurance.

But that coverage was terminated following a letter he wrote in mid-March 2017, which asked for its cancellation. The coverage officially lapsed on April 1; the cancer diagnosis, which would have qualified as a critical illness under the cancelled coverage, came on May 23.

Manulife cited the fact that Manley’s critical illness coverage was no longer in force at the time of the diagnosis. But in a letter to the firm that was coursed to its ombuds office, he said: “I would respectfully suggest that Manulife’s values (customer focus, trustworthiness and reliability) would indicate that this is a circumstance in which a strict reliance on the letter of the policy rather than its intent…is inappropriate.”

Pointing out that his kidney tumour had been present at the time when he was still paying premiums for critical illness coverage, Manley asserted that the condition, rather than the diagnosis, should be the factor determining his entitlement to coverage.

Manulife stood its ground, prompting Manley to launch a breach of contract suit in January 2018. Gordon Jermane, Manulife’s legal counsel, argued that the insurance policy clearly indicated that a critical illness diagnosis would be considered as the triggering event for a policy entitlement. Ontario Superior Court Justice Sylvia Corthorn, who oversaw the case, ruled in favour of the insurance firm in a decision released last week.

“The making of a diagnosis by a physician — and the receiving of a diagnosis by the insured person — is a clear, indisputable event which validates the existence of a covered condition,” she said. Since the moment when a condition arose can be difficult to ascertain, making insurance decisions based on that event would lead to more uncertainty and disputes, she added.

“Unfortunately for Mr. Manley, the loss of entitlement to [his previous critical insurance coverage] is the consequence of the decision he made several months earlier to terminate the rider effective March 31, 2017,” Corthorn said.

Responding to questions about the case, Manley’s lawyer Christopher Spiteri said an appeal of the decision is being considered, reported the Post.