Why your insurance doesn’t pay for “your condition”
I’ve been seeing this Prudential case everywhere lately. A woman suffers a stroke, survives (thankfully), goes through surgery… and then gets her claim rejected.
Naturally, the internet response is predictable:
“Insurance scam.”
“Company trying to avoid payout.”
“AIA is better?”
But when I dug deeper into the details, I realised something uncomfortable…
Most people misunderstand how critical illness insurance actually works.
And if you don’t get this part right, you might be paying for something you don’t fully understand.
Here’s what happened in simple terms.
A 45-year-old woman in Singapore is suing Prudential after her claim for over S$100,000 was denied. She had a ruptured brain aneurysm and underwent a modern, minimally invasive procedure called endovascular repair.
The problem?
Her policy only pays out if the aneurysm is treated using a specific surgery – surgical craniotomy (open skull surgery). And her procedure didn’t meet that definition.
From her perspective, it feels unfair.
She had the condition. She went through surgery. She paid premiums.
AIA paid out, so why no payout from Pru?
From Prudential’s perspective, the answer is simple. The policy definition was clear. If the definition isn’t met, there is no contractual obligation to pay.
And this is the part most people (and a lot of insurance agents) don’t realise:
Critical illness (CI) and early CI are not based on “the condition” – they are based on definitions.
Not diagnosis alone.
Not “doctor say you have it”.
Not “you went through treatment”.
Definitions.
Let me say something that might sound controversial at first:
If insurers paid out based on any condition, any treatment, any variation, your premiums would explode.
Think about it.
If “brain aneurysm = payout regardless of treatment type”, then insurers are effectively covering every possible medical pathway, including newer, more common, less invasive ones.
That sounds great as a consumer… until you see the premiums.
Because insurance pricing works like this: More uncertainty + broader coverage = higher premiums.
So insurers do something very deliberate. They narrow definitions.
Not because they’re evil (okay, maybe sometimes questionable 😂), but because it allows them to price the product in a way people are willing to pay.
And here’s where I’ll defend insurers a bit:
If you meet the policy definition, they must pay you. It’s contractual.
But the flip side is just as important:
If you don’t meet the definition, they also don’t have to pay.
And this is not just a Prudential thing.
This could happen with AIA. This could happen with any insurer.
So when someone says, “This company better than that one,” I always get a bit cautious.
Because unless you’re reading and understanding every single definition across dozens of conditions, that statement is… honestly quite dangerous.
I think the mistake most people are making with this case… is trying to find who is right.
Is it the insurer? Is it the patient? Is it the agent?
But the more I think about it, the more I realise, you can actually make a reasonable argument for every single party involved.
Let’s start with the insurer’s angle (whether you like it or not)
I’ll say this very directly – not because it’s popular, but because it’s true.
ECI/CI policies were never designed to pay based on “you have the condition”.
They were designed to pay based on whether you meet a definition.
That definition could include:
- how severe it is
- what treatment was done
- what the outcome looks like
And that’s not an accident. It’s intentional.
Because the moment insurers move towards “condition = payout”
They lose control over pricing.
Think about what that would mean.
If every cancer diagnosis, aneurysm, stroke, or medical variation automatically triggers a payout…
Then insurers are effectively covering all current treatments, all future treatments, and all medical uncertainty.
And there is only one way to price that kind of risk – much higher premiums.
And this is the part I always emphasise.
If you meet the definition, the insurer must pay you.
Not “maybe”. Not “depends”. Must.
That’s the strength of a contract.
But contracts cut both ways.
If you don’t meet the definition…
Then from their perspective, there is no claim to pay.
And this doesn’t just apply to one company.
It applies across the industry.
Now let’s flip to the doctor’s angle
Because in real life… when something like this happens, the doctor is right in the middle of it.
And here’s something I’ve heard many times – patients bring their policies to doctors ask the doctor to write it according to policy definitions.
Now, some doctors may try to help within reason.
But there is a very clear boundary they cannot cross.
Doctors are not there to optimise your insurance claim.
They are there to treat you in the safest, most effective way possible
So if medical practice has evolved… And the better treatment today is:
- less invasive
- lower risk
- faster recovery
That’s what you’re going to get.
Not because of insurance. But because of medicine.
And this is where the tension really shows up.
Because sometimes…the best treatment for your health is not the treatment that triggers your policy payout
And no doctor is going to say:
“Let’s go for the riskier option so your insurance can pay.”
That’s just not how healthcare works.
Now let’s be honest about the consumer’s angle
If I put myself in her shoes…I would feel the same way. Damn seebee sia.
You:
- paid premiums for years
- went through a life-threatening condition
- underwent surgery
- survived
And then the person you’ve been paying for the past many years tells you: “Sorry, this doesn’t qualify.”
Of course it feels wrong.
Because the expectation most people have is very simple – “If I get the condition, I should be covered.”
And this is where expectation and reality collide.
Because in insurance terms, what you actually bought was coverage for a very specific version of that condition
Not all versions.
Not all treatments.
Not all scenarios.
And once you see it this way…
You start to realise something uncomfortable – there will always be people who genuinely fall sick and genuinely go through treatment…but still don’t get a payout.
Not because the system failed randomly. But because they fall outside the definitions.
This is where most people try to outsmart the system.
They’ll say: “Okay, then I just choose the most lenient policy.”
Makes sense on the surface. But let me challenge that a bit.
What does “lenient” actually mean?
Is it few exclusions? Is it broader wording? Is it different treatment requirements?
And more importantly… Do you actually understand those definitions medically?
Because most people don’t (I know I don’t).
You have to remember this, CI policies contain dozens of definitions.
Some policies cover up to 187 conditions. Imagine the amount of definitions you’ll have to learn.
Might as well become doctor.
And even if you get it “right” today… the future can still break it
Let’s say you’re very diligent.
You compare policies, read definitions, choose what seems more flexible.
Then fast forward 10, 15, 20 years.
Medicine evolves.
New treatments become safer, faster, and more common.
Old treatments become outdated, riskier, sometimes even avoided.
Now your policy is stuck in time.
Written based on yesterday’s medical standards, but your claim happens in tomorrow’s medical reality.
And suddenly, you’re back in the same situation again.
This is why I say… This isn’t a one-off issue.
It’s a structural one.
What I think needs to happen
At this point, I don’t think this is something the industry can solve on its own.
The incentives are not fully aligned:
- Insurers need to manage risk and pricing
- Doctors will always prioritise best treatment
- Consumers are left trying to interpret both
Which is why this is where I believe MOH (and to some extent MAS) needs to step in more actively.
Not to over-control the market, but to reduce the growing gap between how policies are written and how medicine is actually practised.
Outcome-based definitions
Right now, many policies are tied to specific procedures and/or specific treatment methods.
But procedures change.
Medical outcomes are more stable.
So instead of asking:
- “What surgery was done?”
We should move towards:
- “What was the severity of the condition?”
- “What is the long-term impact on the patient?”
This reduces the risk of situations where you receive the best available treatment but still don’t qualify for a payout.
Definition updates over time
Policies today are often based on medical standards from years ago. But medicine evolves quickly.
If definitions remain static, they become outdated and increasingly misaligned with real-world treatment.
There needs to be a mechanism where:
- definitions are reviewed periodically
- benchmarked against current medical practice
- and updated where necessary
If not, more cases like this are inevitable.
Understanding trade-offs
This is the part I feel strongly about.
Most consumers don’t realise they are making a trade-off when they buy a policy.
In reality:
- stricter definitions → lower premiums
- broader definitions → higher premiums
Over 6 years of running Dollar Bureau, one common trend I see after helping over 3,000+ Singaporeans… nobody wants to pay more to the insurer.
Everybody would prefer to pay less, for more coverage, and keep the savings for their own use.
So we need to understand that we can’t have the cake and eat it at the same time.
Unless you’re really rich and willing to pay hefty premiums for the policy – then buy from me pls.
At the end of the day, this isn’t about making insurance “perfect”.
That’s not possible.
It’s about making sure that expectations, definitions, and real-world outcomes are better aligned.
Because right now, the gap between them is where most of the pain happens.
Stay informed, stay clear-headed… and stay intentional.