Life Insurance sold by a bank

Gooner83 · 23 June 2017 at 1:51PM

My wife has recently found a life insurance policy she was unaware of. 5 years ago she went to see a banks financial adviser regarding a investment, she was sold the investments and the life insurance policy, however she can not recall agreeing to it. The paper work is all there to prove that she did so.

She was sold the life insurance at a time when she was single and had no dependents. Has anyone else had any similar experience where they have been sold life insurance policies which they did not need at the time. Is there anything which can be done about this?

dunstonh · 23 June 2017 at 2:00PM

She was sold the life insurance at a time when she was single and had no dependents. Has anyone else had any similar experience where they have been sold life insurance policies which they did not need at the time. Is there anything which can be done about this?

Since 2005, a statement of demands and needs would be required. This document states the justification to meet the financial needs. So, what does that document say? That is key to whether there is a case to answer or not.

Was it life assurance only or Life plus Critical Illness cover?

haras_nosirrah · 23 June 2017 at 2:04PM

does she need the life cover now? If you complain they will cancel the cover and getting another policy now would be more expensive due to age. If you have no property, children, financial need for cover then cancel and complain if you feel she was missold the policy. If you have a need for cover now even if you didn't then then complaining may cost you more in the long run

Gooner83 · 23 June 2017 at 3:48PM

Thank you for the responses.

@dunstonh, she doesn't remember any statement of demands and needs, this is the first we've heard of that. There is also no paperwork for that. It was life + critical illness.

@haras_nosirrah, we searched online for a like for like policy and found one which was £50 cheaper. We then called her current insurance provider who said they would match the price. So they are willing to provide her existing policy at £50 less.

dunstonh · 23 June 2017 at 4:32PM

she doesn't remember any statement of demands and needs, this is the first we've heard of that. There is also no paperwork for that.

Most people don't. I spent a very long time on a suitability Report (the investment equivalent) for a client and a few months later he phoned up asking questions. All of which were covered in the report. I asked him if he read the report and he said he could not remember it. Two days later he emailed me to say he found it in the draw.

It was life + critical illness.

This is the vital bit of information. And this means it was not missold.

CIC standalone is usually the same cost or just pennies different from Life & CIC. So, it's considered best practise to include life cover, even if it not immediately required.

we searched online for a like for like policy and found one which was £50 cheaper. We then called her current insurance provider who said they would match the price. So they are willing to provide her existing policy at £50 less.

Banks are more expensive than other distributions. However, a £50pm difference is way above the typical level (unless she is paying say £150pm). This would suggest it is not a like-for-like comparison. We have seem people comparing Life & TI vs Life & CIC before thinking they were the same thing. They are not. Or a budget CIC vs a comprehensive CIC. Even if you are comparing life & CIC vs life & CIC, it is unlikely that two providers are like for like.

Life Insurance sold by a bank

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