What happens if I don't disclose a medical condition on an income protection application?

If you leave a medical condition off an income protection application, the insurer can refuse to pay a claim, cancel the policy, or pay the claim minus an extra premium it would have charged had it known. Income protection pays a regular tax-free monthly income if you cannot work through any illness or injury, so a refused claim lands at the point you have least room to absorb it¹.

The rules are not all or nothing. The Consumer Insurance (Disclosure and Representations) Act 2012 protects you when you first take out a policy, but not for information you fail to give mid-term, so an insurer may reject a claim even where you took reasonable care³. The Financial Ombudsman Service, which decides disputes between consumers and insurers for free, looks at what you knew, what you were asked, and what the insurer would have done differently⁴.

This page sets out what counts as non-disclosure, how insurers find out at claim stage, how deliberate, careless and innocent mistakes are treated differently, how to correct an application after the policy has started, and where to get help if a claim is refused.

Not mentioning a medical condition can mean a claim is not paid

The starting point is that an income protection policy is a contract built on the answers you give. Citizens Advice is direct about the scope of what you must supply: "You must give your insurer full details of you and your family's medical history", along with dangerous hobbies or a lifestyle that includes smoking, heavy drinking or drug taking¹. The same disclosure duty runs across protection and general insurance. On car cover, an insurer may cancel your policy and any claims may be rejected if you do not give complete information². On a written-off vehicle, if you fail to declare the total loss history, your insurer can reject any claim you may make on the grounds of non-disclosure⁸.

Income protection itself does not cover everything even when it is properly arranged. Policies do not always cover every type of illness and may exclude pre-existing medical conditions, and some say you cannot claim if you can do other kinds of work than your own¹. A claim also has to meet the insurer's definition of being unable to work, which may involve medical evidence⁹. So a condition you left out can fail on two fronts: the insurer may treat the policy as misrepresented, and the condition may sit outside the cover the policy was written to provide.

Where a condition is not declared, the practical outcome is usually exclusion rather than argument. As one independent review put it, if you do not declare a medical condition, then in the vast majority of cases it is going to be excluded by default¹⁰. The same pattern appears in travel cover, where it is very likely that a claim will be rejected, leaving you to pay for the cost of treatment yourself¹¹.

What counts as non-disclosure on an application

Non-disclosure is not limited to a diagnosis you are hiding. It is anything the insurer asked about that you did not answer accurately, and the questions are broad. Applicants are normally asked about current health, previous health problems and any major health problems in the family¹². Where a specific condition is involved, the detail expected is considerable: for diabetes, insurers ask whether you have type 1 or type 2 or a rarer form, your HbA1c average blood glucose test results, any hospitalisations or significant developments, changes to your treatment, and any complications you have experienced¹³.

Mental health conditions count in the same way as physical ones. Diagnosed medical conditions of any kind need to be disclosed to your insurance provider, and this includes health conditions relating to your mental health¹¹. Insurers usually will not cover pre-existing medical conditions unless they have been declared and added to the policy¹⁴. You usually have to tell insurance companies about pre-existing conditions such as cancer¹⁵.

Two boundaries are worth knowing. Being a carrier of a genetic condition but showing no symptoms does not need to be disclosed, though all relevant medical history must be disclosed¹². And undiagnosed conditions, including anything you are currently being tested or referred for, must still be declared¹⁶.

How insurers find out at the point of a claim

Insurers do not usually investigate your health when you apply. They find out when you claim, because a claim for income protection requires medical evidence that meets the insurer's definition of being unable to work⁹. That evidence, typically from your GP or specialist, will describe your history, and a condition that predates the policy tends to surface there.

The ombudsman's approach to a change in health shows how the timing is unpicked. Where a customer did not tell the insurer about a significant change in health, if the insurer would have covered the condition for an additional premium, the ombudsman will generally consider it fair for them to pay the claim minus any additional premium which would have been charged⁵. Where the change was not reported, the insurer may only be liable to cover the payments made prior to the change in health⁵.

For individually underwritten policies, the process is meant to be transparent at the outset: the insurer tells you whether the conditions you have declared are covered, and if they are not, you may be able to pay an additional premium to have them included⁴. That is the moment to settle the question, because it is far cheaper than settling it at claim stage.

Deliberate, careless or innocent: why the reason matters

The reason a condition was left out changes the outcome more than the omission itself. The ombudsman's position is that if a consumer knowingly withheld relevant information, it is unlikely to uphold the complaint, but if they did not tell the insurer because the business gave them no reason to believe the condition was relevant, it is likely to uphold it⁶. Where a consumer gave incorrect information in their application, the complaint would usually not be upheld on that basis alone⁶. And if a consumer was not aware of an existing medical condition when they took out a policy, the ombudsman will usually conclude the policy was not mis-sold⁶.

The same distinction runs through the wider system. On benefits, deliberately failing to report changes is benefit fraud, while a claim might be stopped or reduced if you do not report a change straight away or you give incorrect information¹⁷. The principle is that intent and awareness are weighed, not just the gap on the form.

Honesty at the point of application is the protection. Answering all questions truthfully will prevent any chances of your policy becoming void¹². For critical illness cover, you must tell the truth in your application about any pre-existing conditions, because if the insurer finds out later that you were not entirely honest, it could void your entire policy¹⁸.

Correcting an application after the policy has started

If you realise something is missing, the useful move is to tell the insurer rather than wait. When a customer tells an insurer about a change in health, the insurer has four options: cover the medical condition for no additional premium, charge an additional premium, apply an exclusion, or withdraw cover altogether⁴. Which one applies depends on the condition and the insurer's underwriting.

Whether you are obliged to report a change depends on the policy. The ombudsman says customers should tell insurers about significant changes to their health when they become aware of them, even if they are waiting for a diagnosis, if the policy asks them to⁵. For travel cover, once you buy the policy you must tell the insurer if there are any changes in your health or condition¹⁹. For life insurance, the position is different: once a policy is in place the premiums cannot be increased, and as long as you made full and honest disclosures on your application and continue paying the premiums, the policy cannot be cancelled²⁰. There is often no need to tell your life insurer if you develop cancer²¹.

For treatment that starts after cover begins, there is no need to tell the insurance company unless it specifically requests it, but the treatment must be disclosed on any new policy¹². If you are applying for new cover with an existing condition, expect to supply full details of when you were first diagnosed, your medical history, and the specifics of your treatment and medication¹³.

Getting help if a claim is refused

A refused claim is not the end of the process. The Financial Ombudsman Service looks at the policy's terms and conditions, exclusions for pre-existing medical conditions, misrepresentation and non-disclosure, and change in health⁴. It is free to use, and consumers can bring a complaint to it if the financial firm refuses a refund and the consumer disagrees²². If a complaint needs to be dealt with urgently because you are facing financial hardship or severe ill health, you can say so²³. Where the illness falls within the policy's definition of a listed critical illness or permanent and total disability, the ombudsman can tell your insurer to pay the claim with interest²⁴.

Before that stage, the insurer's own complaints procedure comes first, and the ombudsman can only step in once it is exhausted. The scale of this kind of dispute is not trivial: in 2006-07 the ombudsman closed 376 complaints where non-disclosure was the dominant issue in critical illness and income protection disputes²⁵, and in the year ended 31 March 2009 it took on 774 new income protection insurance cases²⁶. In 2009, 31% of health insurance complaints were upheld²⁶.

If the insurer itself has failed, income protection claims are covered by the Financial Services Compensation Scheme: 100% payment if the firm failed on or after 3 July 2015, and 90% if before⁷. Free, impartial help on benefits and money is available from Citizens Advice and Macmillan's financial support services, and the ombudsman service is free to consumers¹.