The Commonwealth Bank’s insurance arm, Comminsure, refused a trauma payout to a customer who had suffered a heart attack, despite internal advice recommending that it did, the financial services royal commission has heard.

Comminsure executive Helen Troup told the commission on Wednesday that the group had rejected the 2014 claim (from an unnamed member) because he did not qualify under a definition of heart attack that was applicable at the time.

That definition demanded a defined level of the hormone treponin be evident in the blood after a heart attack. The claimant did not have meet that requirement.

The customer’s GP expressed surprise that the claim had been rejected, given the circumstances of the patient’s case.

Comminsure changed its definition of heart attack in 2016, backdating the change to May 2014. But the customer still missed out because his heart attack was in January 2014.

“At the time, the consideration was the claim didn’t meet the definition at the time and it wasn’t considered appropriate for ex-gratia,” Ms Troup said.

When the matter was referred to Comminsure consulting physician Dr Alan Carless, he said the customer would be entitled to a claim under new definition.

“Overall the condition does meet this definition,” the doctor said.

An internal dispute resolution officer recommended an ex gratia payment because the patient’s claim was just a few months outside the new deadline. Comminsure again refused, but authorised a $10,000 payment because the trauma claim partially met its criteria.

If the customer had met Comminsure’s definition, he would have been entitled to $100,000.

Eventually, the customer took his complaint to the Financial Ombudsman’s Service, which took up his case. Comminsure told the FOS that because the case did not meet the company’s definitional standards, the ombudsman should stay out of it and accept Comminsure’s actions and decisions as a “commercial judgement”.

FOS rejected that, pushing on with support for the complainant.

Ms Troup said Comminsure was “unhappy with FOS” and considered that it was essentially wanting to amend a contract. That would make it hard for insurers to operate effectively as they relied on contracts, she said.

“If FOS could determine when to apply a definition from, that would make it fairly challenging for us to run our business,” Ms Troup said.