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MPPI with Paymentshield - Premiums increase
Juebham
Posts: 2 Newbie
Being a best buy I took out MPPI with paymentshield/British Insurance about 4 months ago, the premiums being around £29 for approx £1700 per month of cover. Today I've received a letter putting my monthly premiums up to around £57 for the same cover, with a note that after the first 12 months of my policy I would also be subject to an increased admin charge of £3.
The increase has been blamed on Norwich Union underwriters and the increased number of claims being made. Whilst I do understand the current economic climate etc, a jump of this much seems a bit excessive. Not being an expert in these areas are they entitled to increase the premiums by such a large amount after 4 months?
Also, I assume that should the current climate worsen / continue that they'll increase the premium again.
Any advice gratefully received.
The increase has been blamed on Norwich Union underwriters and the increased number of claims being made. Whilst I do understand the current economic climate etc, a jump of this much seems a bit excessive. Not being an expert in these areas are they entitled to increase the premiums by such a large amount after 4 months?
Also, I assume that should the current climate worsen / continue that they'll increase the premium again.
Any advice gratefully received.
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Comments
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are they entitled to increase the premiums by such a large amount after 4 months?
Yes they are. The premiums are reviewable and the terms allow them to do it.
Expect others to announce more in the next few weeks as well.
Also, I assume that should the current climate worsen / continue that they'll increase the premium again.
Yes.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
As I feared. I'll probably just have to stick with it for now ... hopefully I won't need to claim but you never know (which is what insurance is all about I suppose).
Thanks for your response0 -
Me and my fiance have the same policy and also received letters increasing the premiums. We currently pay £18 and £14 and they are going up to £33 and £25. I wouldn't mind so much if it was only a 20% increase, but an 80% increase seems rather excessive.
We are going to do some research and look at other policies to compare monthly premiums, although Paymentshield is probably still the cheapest. I am considering cancelling the policy and overpaying on the mortgage each month instead (I think that we can borrow the money back if we need it but I need to read through all of the paperwork again). I'm also going to research payment holidays on the mortgage. I wouldn't really want to take a payment holiday as the interest would just mount up, but it would be there as a final option if one of us were to be made redundant and couldn't get another job for a while.
I know I haven't helped you Juebham, but just to let you know that you're not on your own. Things were so much easier when I still lived with my parents!!0 -
A lot of people dont realise this but the MPPIs will only pay out the amount of your mortage plus x% to cover insurances. So, if you set this up some time ago and your mortgage payment was say £800 and you set the cover for £800 a month then you should notify the intermediary of the change in your mortgage if it has changed a lot from that. For many people their mortgage payments could have halved.
If your MPPI is for £800 and your mortgage is £450 then it will not pay £800 in the event of a claim. It will pay £450. plus x% to cover insurances.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Also, please take in to consideration that you will receive one weeks pay for every 1 year of service for the company. That is if you are made redundant!
Also, if you have total savings less than £8,000 you will only have to wait 13 weeks for income support mortgage interest from the government.Motto: 'If you don't ask, you don't get!!'
Remember to say thank you to people who help you out!
Also, thank you to people who help me out.0 -
Got my letter today from Payment Shield. They are increasing my premium from £31 to over £60. Can't believe they can do this :mad:0
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We today received notification that our premiums with Paymentshield were going up fro £94.50 to £177, which we cannot afford. We are going to have to cancel our policy, if anyone can recommend an alternative, please let me know.0
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TEDDYRUKSPIN wrote: »Also, please take in to consideration that you will receive one weeks pay for every 1 year of service for the company. That is if you are made redundant!
Also, if you have total savings less than £8,000 you will only have to wait 13 weeks for income support mortgage interest from the government.
Does your severance count to this?It pays to challenge0 -
Got my letter today from Payment Shield. They are increasing my premium from £31 to over £60. Can't believe they can do this :mad:
If you ran an insurance company providing redundancy cover and at the same time there were lots and lots of redundancies being made - is it really that huge a surprise?Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
Can't comment for the British Insurance - as thats a direct off the page ( no advice) product - albeit some of their plans were white labels of the Paymentshield plan- and in more recent times both firms where taken over by the same larger company.
The T&C I have says no more increases in next 6 months, although of course they do have rights to cancel, policies with notice.
We are getting a lot of new users to this website ( welcome)on tghis and other threads all quoting very high % increases , whereas to date I have not personally seen anything outside of the 15-30% range for P/s plans . ( maybe those calls will come later )
could it be either some of these much higher increases are
1 . For Brit Ins branded policies that were originally sold cheaper.. so putting them in line with the rest of their "book" - possibly even those brought policy via websites have a higher claims history.
2 Some particularly higher risk sectors ( they said each case priced individually ) if so what .. age, gender, location, occupation, sector , employer, etc... OR status when policy taken out ( again maybe higher increases for plans not originally taken with a new mortgage- if this reflects their claims pattern )
3. Maybe those with lower % increases aren't bothering to post, as not seen as much an issue
4. ( I hope not) representives of other providers posting imaginary increasesAny posts on here are for information and discussion purposes only and shouldn't be seen as (financial) advice.0
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