From a legal perspective, this situation is governed by basic contract law principles – one of the most interesting courses in first year law school is contracts because the principles come from old cases which are really interesting.
You are caught by the rule call “privity of contract”, which states that only parties to a contract can have rights rights and obligations under that contract. This is basically what the insurer is telling you…however…group insurance contracts are recognized as a “special situation” because the whole purpose of the contract IS TO GIVE RIGHTS AND OBLIGATIONS to a third set of people, who are technically not a party to the contract (the group members). This is why legislators have stepped in some provinces to pass statutes and regulations that over-ride the doctrine of privity of contract in Group Insurance Cases.
However, I believe that even in a province where such statutes and regulations don’t exist, I believe there judge would be very open to the idea of finding a common law exception because of the special nature of group insurance contracts. However, most judges will simply say this is something the elected members of the provincial legislature should do. Really that is where the change must happen for this problem to be solved.
I can never get a case on this issue to court, because once I get involved they just send the Master Policy thereby taking away the grounds for the court motion.