One man who held such a policy lodged a claim after learning that he had a brain tumour, but he was turned down because he had consulted his doctor about ringing in his ears before taking out the policy. The insurer argued that this indicated that he had a pre-existing medical condition which rendered their agreement null and void. The fact that he did not know about the tumour because his GPhad treated him for wax in the earsdid not matter.
Cautionary tales of this kind proliferated in the early 1990s as insurers introduced more and more exclusion clauses after being forced to pay out on hundreds of thousands of mortgage protection policies during the worst years of the recession. But as Mrs Rubin's case demonstrates, the problem continues. Complaints about mortgage-related insurance policies have, in fact, contributed to the 15 per cent rise in the workload of the Building Society Ombudsman. Such cases accounted for two-thirds of last year's record total of 10,431 complaints.
The number is worrying, but hardly surprising given how difficult it now is to make a successful claim. Employees who lose their jobs within three months - sometimes six - of taking out mortgage protection policies are not entitled to receive any help. Those who are disabled within two months of entering into an agreement can find that they are not covered either. And back-pain sufferers can also be left empty-handed unless they can show radiological evidence of damage.
The Insurance Ombudsman has criticised companies for failing to draw customers' attention to the many exclusion clauses in their agreements. He accepts that the insurers have lost money on mortgage protection but is not altogether sympathetic. The art of insurance underwriting is to balance losses in some sectors against profits in others, the companies have been told. Some have responded by offering policies with fewer exclusion clauses, but most insurers still do not appear to be keen to heed the Ombudsman's advice.