A woman whose husband died seven months after his life insurance policy was cancelled due to non-payment of premiums has lost a dispute over a death benefit claim.

Her late husband took out a life insurance policy with Asteron Life & Superannuation in July 2017 and the first premium was payable on the following Thursday.

A series of dishonour notices due to non-payment of premiums was sent the following month. No premiums were ever paid, and Asteron cancelled the policy in early October 2017.

The husband passed away around seven months later, on April 24 2018, and his wife lodged a claim against the policy for the death benefit, challenging the policy’s cancellation.

She said no correspondence was ever received and provided information from the local postal officer that the residential address to which Asteron’s documents had been sent did not exist.

Asteron provided evidence to the Australian Financial Complaints Authority (AFCA) showing that the PO Box address it sent policy documentation and overdue premium notices was the same one as the late insured had provided to Asteron when he took out his policy.

AFCA ruled Asteron was entitled to decline the claim and said that when the policy was taken out by telephone, the woman told Asteron to send all policy information to the PO Box address.

“The outcome is fair as neither the late insured nor the woman paid any policy premiums between the date the policy was taken out and its cancellation or prior to the date of the late insured’s passing,” AFCA said.

“Asteron had sent dishonour notices and the cancellation notice to the PO Box address provided by both the woman and the late insured to Asteron, so it was reasonable to expect they would have received them.”

A telephone recording of a conversation with the married couple and Asteron’s salesperson revealed the late husband provided both a residential address and PO Box address. Asteron’s representative agreed to send the policy documentation to the PO box address and the woman, who had previously taken out a similar policy with Asteron, acknowledged she understood this procedure as she had received such documentation after she took out her policy.

“The woman has provided information from a postmaster that the postal residential address in Asteron’s records did not exist. I accept this is so, but I am satisfied this was the address given in the telephone conversation to Asteron’s salesperson,” AFCA’s ombudsman said.

“I am further satisfied the late insured provided the PO Box number to which the documents were sent in the same conversation.”

See the full ruling here.