Am I being bullied by my broker?

louzoo

First time buyer in 2006 recommended decreasing life assurance through norwich union. Have been paying regularly but in review of finances found a better policy - level term and used trust for kids so cancelled other policy. According to my broker I should not have done this for 4 years and now unless I go back to Norwich Union or take out another policy via them they say we owe them £600. I agree I understood that we were not charged a fee as they got their commision for a product, but we were unaware of this four year rule and feel bullied. The people who recommended the new policy have said that I should not have to pay it back and it is a form of bullying but I am not sure where I stand legally and how to stand my ground. Anyone been through this? (I should add that in 2006 we purchased a repossed property and so everything had to be completed in 28 days so were we niave or ill advised?)

dunstonh

ccording to my broker I should not have done this for 4 years and now unless I go back to Norwich Union or take out another policy via them they say we owe them £600.

If you agreed a fee for the transaction and the commission was being used to offset the fee then this is correct.

I agree I understood that we were not charged a fee as they got their commision for a product, but we were unaware of this four year rule and feel bullied.

Ask for a copy of the fee agreement that shows you agreed to pay this.

The people who recommended the new policy have said that I should not have to pay it back and it is a form of bullying but I am not sure where I stand legally and how to stand my ground.

The new company is wrong to say that as you may have a liability if a fee agreement exists. However, if no fee agreement exists then you do not.

so were we niave or ill advised?

Depends on the terms you agreed with the adviser. If on customer agreed remuneration then it can be a lot cheaper that way than pure commission. However there are some sales reps that abuse this system to scare you into paying their commission if clawed back which they are not allowed to do unless it was part of the remuneration agreement. Even if you did agree on fee basis with commission offset then they are only able to claim back the difference between what they have received to date and what is outstanding. i.e. if they have had £400 already and the agreement was £600 then they can only ask for £200.