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Onus of proof on a balance of probability

07 December 2021 Myra Knoesen

We summed up some case studies from the Ombudsman for Short Term Insurance’s (OSTI) briefcase, which we thought would be interesting for our readers

Damage to asbestos roof

The insured bought a house and moved in on 7 September 2020. On 31 October 2020, there was a major storm during which the asbestos roof leaked and resulted in internal damage to the insured property. The insured submitted a claim for both the damage to the roof and internal damage.

Insurer’s rejection of the claim

The insurer’s appointed assessor established that the roof had gradual wear and tear issues. The insured contested the findings and appointed his own engineer to assess the roof.

The report from the insured’s engineer indicated that the structure of the roof trusses and purlins were not in accordance with the required specifications. The insurer also pointed out that some timber used in the roof was not SABS approved.

The insurer partially settled the claim for the internal damage and declined liability for the roof damage on the ground that the roof was badly maintained and not constructed according to the correct specifications.

The insured argued that he should not be held responsible for the maintenance of the roof as he had only begun occupying the property on 7 September. Before moving in, he had asked the insurer to inspect the property. According to him, the insurer was not supposed to insure the property without doing an inspection. The insured wanted OSTI to compel the insurer to repair or replace the roof.

OSTI’s findings on rejection

OSTI held that the engineer’s report stated clearly that the whole roof structure required replacement. OSTI also noted that the engineer had found fundamental defects that were not related to the storm damage, and which clearly existed prior to the inception of the policy and even before the insured bought the property.

OSTI held that the insured’s argument that his claim for the roof must be settled because he had only recently taken occupation of the insured property was misguided. The argument suggests that the insured did not know of the condition of the roof and that he found the property in the condition it was in, justifying his argument that the insurer is liable. However, this argument applies equally in favour of the insurer.

It was the insured’s responsibility to satisfy himself that the property was free from defects. Any defects that existed at the time of purchase had to be taken up with the seller rather than with the insurer.

OSTI’s finding was that the insurer had no legal or other obligation to inspect the property before providing the cover. Having considered all the issues raised, OSTI held that there were no peculiar circumstances that justified a different outcome to that dictated by the policy terms and conditions, in accordance with which there was no cover for the damage to the roof. OSTI upheld the insurer’s decision to reject the portion of the claim for the roof damage.

Medical conditions excluded

The insured purchased travel insurance as he was travelling to Thailand with his wife. They were scheduled to depart on 8 October 2018 and the policy would commence on the departure date and terminate on 17 October 2018. The insured said that he had a very small sore in his nose which had healed well in advance of the departure date, and he did not experience any discomfort on the departure date.

After arriving in Thailand, the condition of the pimple had escalated into what the insured described as a boil. This prompted him to seek medical assistance.

During the first consultation on 13 October 2018, the insured informed the treating doctor about the small sore he had in his nose before the departure date. The treating doctor referred him to a hospital for treatment by a specialist. The specialist wanted to admit him for three nights to continue with treatment. The insured approached the insurer and submitted a claim for medical fees and curtailment under the travel insurance policy.

Insurer’s rejection of the claim

The insurer rejected the claim on the ground that it arose, directly or indirectly, as a result of a pre-existing medical condition that was not covered.

The insured flew back to South Africa on the evening of 14 October. On 15 October, he was treated by a local specialist. The infection stopped almost immediately.

The specialist, through a letter dated 25 October, stated that “it is not impossible that the infection that started in Thailand was a different or a second one, and the initial complaint is, therefore, not necessarily the start of what he had in Thailand”. The insured submitted the specialist’s letter in support of his claim. The insurer thus bore the onus of establishing its entitlement to invoke the exclusion on which it relied, namely the “Pre-existing Medical Condition” exclusion, defined in the policy.

OSTI’s findings

OSTI noted that while the insured was on the flight to Thailand, he noticed that he had a blind pimple on his nostril. During the first consultation, the insured advised the Thai treating doctor that he had a sore on his nose two weeks before consulting.

In respect of the opinion provided by the local specialist, OSTI found the specialist to have misplaced the expressions “not impossible” and “not necessarily” in consideration of the probabilities.

Having considered the matter, OSTI was satisfied that the insurer had discharged its onus of proof on a balance of probability. Put slightly differently, the medical condition which showed “vigorous escalation” in Thailand, was, as a matter of probability, the same one which manifested itself as a “nose sore”. OSTI accordingly upheld the insurer’s decision to reject the claim.

Rejection not supported by policy

The insured had an endorsed driver’s license requiring him to wear prescription glasses when driving. The insured submitted a claim to the insurer for the damage to his vehicle due to an accident.

Insurer’s rejection of the claim

The insurer rejected the claim on the basis that the insured did not have a valid driver’s license. During the validation of the claim, the insurer established from the insured that, although his license is endorsed requiring him to wear prescription glasses, he was not wearing them at the time of the accident. The insurer argued that the accident could have been avoided if the insured had been wearing his glasses.

Notwithstanding the information, the insurer relied on policy provisions. The clause in the policy relied on by the insurer refers to driving with an endorsed license or without a valid driver’s license.

OSTI’s findings

The insured provided OSTI with a copy of his driver’s license which is valid until 18 August 2022. According to OSTI, it was factually incorrect for the insurer to argue that the insured did not have a valid driver’s license, and that the clause relating to the endorsed license refers specifically to drunken or reckless and negligent driving. There was no evidence to suggest that the complainant’s license was endorsed for drunken or reckless and negligent driving. Therefore, the insurer was not entitled to rely on this point in the clause to reject the claim.

OSTI pointed out that the policy does not include an endorsement for a restriction on glasses/contact lenses. On that basis, the insurer had not provided any proof that the exclusion on which it sought to rely applied in the circumstances and it had therefore failed to discharge its onus. OSTI thus made a provisional ruling that the insurer settle the claim.

Writer’s Thoughts:
Again, these cases remind us of the importance of brokers in helping clients understand their policies… policy provisions, terms and definitions! Do you believe the rulings were fair in these cases? If you have any questions please comment below, interact with us on Twitter at @fanews_online or email me -


Added by Eileen Manser, 09 Feb 2022
Just a question - are houses even allowed to have asbestos roofs anymore. I had a claim a few years ago with an asbestos ceiling and I remember there was some issue with the claim and the replacement of the ceiling, but I cannot recall. I would like to know going forward so we can ask client the question before going on cover. Thank you Eileen
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Added by Cynical Simon, 07 Dec 2021
1.Asbestos Roof..
The partial settlement of the contents claim is the issue here and apparently not addressed as the ruling goes in favour of a proportionate rejection which is nowhere mentioned.
Alarming to the verge of mortal fear, is that the Osti takes it upon herself to interpret the meaning of the words used by a medical specialist, without consulting the specialist, to mean something entirely different from the obvious medical meaning. Granted that eventually the legal principle of preponderance of probabilities must be decided on but certainly not by the medical specialist when he reports on a pure medical perspective .
The OSTI'S ruling is spot on..
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