Serious ill health – The case study of Mr B

Mr B’s father had applied for payment of a serious ill health lump sum. However, before payment was processed, Mr B’s father died. The pension scheme subsequently told Mr B no lump sum would be paid. Mr B then contacted us because he was unhappy about the delays he said his father had experienced, trying to get payment made. Furthermore, the benefits now payable to his mother, were of a lesser value than those which would have been paid had the serious ill health lump sum been processed before his father’s death.

Our adviser contacted the scheme and asked for a breakdown of events. It transpired that it took over 30 days to provide Mr B’s father with the forms he needed to complete. He had returned the completed documentation within 24 hours. It then took seven days for the scheme administrators to forward the documents to the scheme trustees. Further delays then ensued while calculations were made. Before figures could be quoted, Mr B’s father died.

Our adviser suggested to the scheme that, given the circumstances, it was reasonable to have expected more urgency to have been given to the application for payment of a serious ill health lump sum. If the application had been treated in a timelier fashion, it was also reasonable to assume payment would have been made before Mr B’s father died.

The scheme’s trustees reconsidered the events and subsequently agreed that had it not been for the delays, a serious ill health lump sum would have been paid. They agreed it should now be.