Income protection claim declined: what the insurer must tell you and what you can do next

If an insurer declines or disputes an income protection claim, Rule 17.6 of the Policyholder Protection Rules requires written reasons within 10 days of its decision. You have at least 90 days to respond, and the notice must tell you how to escalate and how to reach an ombud.

What does the insurer have to do before it says no?

Rule 17 is about claims management for long-term insurers, and it applies to an income protection claim as it does to any other. It does not tell an insurer what "unable to work" means. That is defined in your policy, and definitions differ. What the Rules govern is how the insurer handles the claim.

Rule 17.2.1(c) says an insurer's claims framework must enable claims to be assessed after taking reasonable steps to gather and investigate all relevant and appropriate information, with due regard to the fair treatment of claimants. Rule 17.2.1(d) requires that it does not impose unreasonable barriers on claimants. Rule 17.8.5 says it may only require information or documentation that is essential to assessing the claim.

Rule 17.10.1 lists prohibited practices. An insurer may not:

• dissuade a claimant from obtaining the services of an attorney or adjuster;
• deny a claim without performing a reasonable investigation; or
• deny a claim based solely on the outcome of a polygraph or similar test.

Rule 7.1(a) goes further by making a policy term void to the extent that it obliges you to undergo such a test in connection with a claim.

Rule 17.8.6 gives you a right to be kept informed of the progress of your claim, the causes of any delay and revised timelines, and the insurer's decision.

What must the notice of a declined claim say?

Rule 17.6.1 says the insurer must accept, repudiate or dispute a claim, or the amount of a claim, within a reasonable period after receiving it. Rule 17.6.2 says it must tell the claimant its decision in writing within 10 days of taking it.

If it repudiates or disputes, Rule 17.6.3 requires the notice, in plain language, to tell you:

1. The reasons, in sufficient detail to let you dispute them.
2. Your right to respond: you may make representations to the insurer within not less than 90 days after the date you receive the notice.
3. The internal process: details of the insurer's claim escalation and review process.
4. The ombud: your right to complain to a relevant ombud, with contact details, time limits and other relevant legislative provisions.
5. Time limits for legal action: if the policy contains a time-limitation provision, that provision and what it means for you; or, if it does not, the prescription period under the Prescription Act, 1969 and what it means.

"Disputes" matters here. A claim can be disputed in part, for example about the amount or the length of time the benefit is payable. Rule 17.6.1 covers disputes about the "quantum" of a claim, so the notice rules apply to those too.

If the decision was made by someone acting for the insurer, Rule 17.6.4 requires that person to give the notice, to include the insurer's name and contact details, and to state that any recourse or enquiries must be directed to the insurer.

What should you do with the 90 days?

The Rules give you the period; they do not tell you what to put in your response. Some practical points follow from the notice you are required to receive.

1. Read the reasons against the policy. Find the clause in your policy that the reason relies on, using the policy schedule and the exclusions list, and read its exact wording.
2. Ask for what the decision relied on. The insurer must give reasons in enough detail for you to dispute them. If a medical report, a form or an investigator's finding was behind the decision, ask for a copy.
3. Put your response in writing. Include the claim number, the dates, and any new evidence, such as a fresh medical report, that speaks to the reason given. Keep a copy and proof that you sent it.
4. Use the escalation process. Rule 17.5.3(c) says the process should provide for claimants to escalate claims not resolved to their satisfaction, and Rule 17.5.2 says it should not be overly complicated or impose unduly burdensome paperwork.

If you make representations under Rule 17.6.3(b), Rule 17.6.5 requires the insurer to tell you its decision within 45 days of receiving them. If it still repudiates or disputes, Rule 17.6.6 requires it to give you reasons, the facts that informed the decision and, again, the escalation, ombud and time-limit information.

Whether you need an attorney, an adviser or a medical practitioner to help is your call. Rule 17.10.1(a) forbids the insurer from dissuading you from using an attorney or adjuster.

What if the dispute is about what you told the insurer?

Sometimes a claim is declined because the insurer says an answer on the application was wrong or incomplete. Rule 21.1 says the policy must not be invalidated, and the insurer's obligations must not be excluded or limited, because of an untrue statement or a failure to disclose unless a reasonable, prudent person would consider it likely to have materially affected the insurer's ability to assess the risk when the policy was issued or varied. Rule 21.2 defines materiality in the same terms. Rule 11.5.1(j) requires the insurer to have given you, within 31 days of the policy starting, the representations it regarded as material. Look at that list. Our guide on what to tell a life insurer explains Rule 21 in more detail, and it applies to long-term policies in general.

What are the time limits for court?

There are two layers.

The first is the policy. Rule 17.6.8 says a time-limitation clause in a policy entered into on or after 1 January 2011 may not count the 90-day representations period, and must allow not less than 6 months after that period expires. For policies entered into before that date, Rule 17.6.7 also says the 90-day period must not be counted. Rule 17.6.9 lets a claimant ask a court to condone non-compliance with a clause if good cause exists and the clause is unfair.

The second is the Prescription Act, 1969. Section 11(d) sets three years for any debt other than those listed in the earlier paragraphs, unless an Act of Parliament provides otherwise. Rule 17.6.10 says that, for section 12(1) of that Act, a debt is due once the 90-day period has expired.

Those are the rules on paper. How they apply to your claim is a legal question for a lawyer or the ombud. Do not assume you have years. Ask early.

Rule 7.1(d) also voids a policy term that says disputes can be resolved only by arbitration, though after a dispute arises you and the insurer can agree to arbitrate (Rule 7.2).

Where do you complain?

Start with the insurer's own process. Rule 18 requires a complaints framework, and Rule 18.7.2 says that when a complaint is rejected the insurer must give clear and adequate reasons and explain any escalation or review process, including how to use it and relevant time limits.

After that, the National Financial Ombud Scheme (NFO) is the industry ombud for long-term insurance. It began on 1 March 2024 as a merger of four earlier schemes, including the Ombudsman for Long-term Insurance, and says that it can look at a complaint only after you have first lodged it with your insurer. It says the service is free to the complainant. Its predecessor for long-term insurance reported that most of its complaints were about claims being declined.

If your complaint is about the person or firm who sold you the policy, for example about advice they gave, the FAIS Ombud is a separate scheme. It says that you should first try to resolve the matter with the provider, which has six weeks, and that after its final response you have six months to submit a complaint.

The Financial Sector Conduct Authority supervises market conduct and takes enquiries and complaints about legislative matters.

How does Olvian fit in?

Olvian is a lead-referral service. We are not an insurer, broker or adviser, and we cannot assess, influence or appeal a claim decision. Our role ends when we pass your request to licensed providers who pay us a fee and call you back. If you are in a dispute with your insurer, use the process above.

Sources

Checked on 31 October 2026. Olvian is not a financial services provider and this guide is information, not advice.

• Policyholder Protection Rules (Long-term Insurance), Rule 17: claims management
• Rule 18: complaints management
• Rule 7: void provisions
• Rule 21: misrepresentation and Rule 11: disclosure
• Prescription Act 68 of 1969, section 11
• National Financial Ombud Scheme: media release of 28 June 2024 and home page
• FAIS Ombud
• Financial Sector Conduct Authority