Permanent Health Insurance

uk4caster

I thought I was the only one being persecuted by these vampires!

My situation is similar. I received a letter regarding my PHI with Royal & Sun Alliance a couple of weeks ago. I have been claiming since 1998 and my policies sound similar to yours - indexation etc. My letter quotes the same benefit limitation clause...and they have cut my payments by about 30% £800 pm.

My situation differs in that I have an ill health retirement pension from the NHS which is also taken into consideration....but they have known this for 7 years plus the indexation. They have always been kept aware of all the figures etc. through their yearly reviews and it seems incredible that they are trying to rewrite the rules now......I have had phone contact with them and I think it says alot that I was told they had set up a special phoneline just to deal with these limitations complaints. There could be hundreds or thousands in our situation.

I haven't had a final decision from them yet but I don't hold out much hope given that the staff dealing with this are probably under threat of redundancy if the payouts are not slashed sufficiently for "Resolution's" needs - it is a scandal - if only enough of us could contact one another maybe we could try and organise a group approachand at least feel less helpless......... in the meantime I guess I will have to go via the ombudsman.

Pity the poor devils too ill or ill equipped to stand up to this.

MarkyMarkD

But are they really "rewriting the rules"? It sounds rather more like they are enforcing rules which they hadn't bothered to enforce in the past.

The idea with this sort of income replacement policy is that you shouldn't be making a profit out of claiming.

If they pay 100% of the reduction in your income, you will be better off, because you won't pay tax on the insurance payout (IIRC). So hence the limits to 2/3 or whatever of your income. And hence other income is offset against this.

mandingo

Hi uk4caster,

Sorry its happened to you, but good to know I'm not on my own here, although there was a similar story on Working Lunch(BBC2) a few weeks ago.

I have continued to receive Incapacity Benefit(non-taxable) since day one of my claim and the Insurer is aware of this. Are we saying this should be taken into account? I just presumed that I still get this along with my PHI because it is a non-taxable State Benefit.

Confusion here!

mandingo

uk4caster have you tried the ombudsman yet?

Having spoken to my IFA, who has consulted a number of his contacts in the field, I keep getting the distinct impression that I will be "opening a can of worms" if I go down the ombudsman route and that maybe I would be wise to let this go.

Surely, I can't just let this lie.

Does anyone out there think I have a case or are these guys likely to suceed?

mandingo

Result!

Just had letter from Resolution advising me that in light of my complaint they are ging to reinstate benefits to the level they were at prior to the limitation and reinstate the annual dynamic increase, together with interest for the underpayment. Anyone else had this?

defender_of_the_weak

This is just another in the list of wizard wheezes from Resolution that we have been receiving information about. if the original policy is written with increase or indexation in payment then so be it. It is up to them to honour the original contract.

I have yet to formally handle a case and have only provided some onfo to people with enquiries but I think they are on poor ground with this one