AXA PPP has apologised for the "human error" mistake that prevented pay out at the point of claim for a Health on Line policyholder suffering from prostate cancer.
Policyholder, 49-year-old Mark Taylor, suffered backache prior to being diagnosed with prostate cancer that had spread to his spine, the Daily Mail reported.
AXA PPP declined to pay out for his claim on a moratorium underwritten policy citing the back pain as a pre-existing condition at the point of claim.
John du Bois, spokesperson for AXA PPP, said: "It was human error and we are sorry. In this particular case the policy was sold on a moratorium basis so it was nothing to do with any non-disclosure issues.
"We did review the case and when we looked more closely we came to the conclusion that the back pain had previously not been linked to the cancer. We got it wrong and we have now put it right."
Brian Walters, principal of PMI specialist firm Regency Health, said the case looked like an unfortunate error that AXA PPP had handled well.
He added: "More than anything this highlights the need to arrange PMI through a broker who will intervene in such situations.
"Private medical insurers generally have a good reputation for settling claims but there are grey areas, particularly in respect of conditions that may be related to excluded conditions."
Alan Lakey, protection specialist adviser and partner principal at Highclere Financial Solutions, said the case highlighted why there was a consumer perception that insurers wriggled out of paying claims.
