Discovery Life heads to SCA in appeal bid over R25m insurance pay out

File Picture: Simphiwe Mbokazi/African News Agency/ANA

File Picture: Simphiwe Mbokazi/African News Agency/ANA

Published May 22, 2023

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Pretoria – Discovery Life will approach the Supreme Court of Appeal in its bid to appeal a high court ruling which ordered the insurance company to pay R25 million to a man who was deemed incapable of working as a stockbroker.

The appeal comes after the Gauteng High Court in Joburg found that the company was unreasonable to reject his claim.

Last week, the high court dismissed Discovery’s appeal and compelled it to pay more than R25m to the client who was identified as PR in court papers.

PR was paying the insurer more than R20 000 in monthly premiums.

PR challenged the repudiation of his claim on a policy he held with Discovery.

PR, who worked as a stockbroker, claimed that at some point between December 28 in 2014 and November 30 in 2015, he had become totally and permanently unable to carry on as a stockbroker.

During that time, he suffered a string of traumatic events that left him with a combination of post-traumatic stress disorder and an unspecified bipolar mood disorder.

He said despite psychotherapy, occupational therapy and an extensive range of drug treatments, he would never recover to the extent necessary to work as a stockbroker.

The insurance policy he took out with Discovery was due to pay out, in the event of permanent incapacity, more than R25m.

Discovery rejected his claim on the basis that his insurance cover expired on November 30 in 2015, and that there was no evidence that he had become totally and permanently unable to perform as a stockbroker by that date.

But Judge Stuard Wilson ruled that Discovery was liable in terms of the contract to pay him the money.

The insurance company returned to court to apply for leave to appeal against the judgment.

PR’s policy promised a “Capital Disability Benefit” in the event that he became permanently incapable of working as a stockbroker.

In his judgment, Judge Wilson held that PR did become permanently incapable of working as a stockbroker on or before November 30, 2015, when his policy lapsed.

The policy lapsed because PR stopped paying his premiums.

He stopped paying his premiums because he had been arrested for several months leading up to November 30, 2015, following the death of his girlfriend in Mauritius.

He was also suffering from what turned out to be a combination of a post-traumatic stress and bipolar mood disorder.

“He still suffers from those conditions today. They have incapacitated him, and prevented him from resuming what was, before his incarceration, a very successful career as a stockbroker,” the judge said at the time.

Counsel for Discovery argued that Judge Wilson had misconstrued the meaning and application of PR’s policy.

Wilson found that the insured event, which triggered Discovery’s liability under the policy, was the onset of PR’s permanent incapacity to work as a stockbroker.

IOL