life insurance. can they do this?

atvpump

Hi to all M.S.E readers
i bought a life insurance policy on friday 2nd Jan
i gave a honest and truthful account of all the questions they asked
they ran it through a program to say i was suitable for immediate cover
and quoted and printed what my cover would be.
i accepted and paid the fee requsted for setting up policy which was taken.

This evening i received an e mail saying they were reducing my cover by almost half what the payout would have been should the worst happen
the reason quoted was my height and weight.
this information was given to them before I bought the policy.
Can they do this? is it Lawful?
After all tescos would not come to me a week later and say i owe them extra for my shopping i bought last week would they.
anyway i could have said i was 2 inches taller and reduced my weight by two stone (it is possible for someones weight to flutuate over a period of years)

can anybody help
i may contact F.S.A

dunstonh

Can they do this?

yes

is it Lawful?

Yes

After all tescos would not come to me a week later and say i owe them extra for my shopping i bought last week would they.

You are not buying apples though are you.

anyway i could have said i was 2 inches taller and reduced my weight by two stone

Then you would be a liar and it would allow the insurance company to reject payment on death.

i may contact F.S.A

They wont be interested. It isnt the role of the FSA to listen to your complaints.

All life assurance illustrations quote on the basis of good health. What is known as a clean application. You are overweight which means you are not a clean application and when it went through underwriting they decided that you are a significant high risk (50% reduction in sum assured or near double rating is quite a heavy adjustment).

Couple of points though.

1 - you say you paid a fee. What was that for? Advice or processing fee for broker? If so, you are paying for the service of setting it up and/or giving advice. Not the policy itself.

2 - The cost of the life assurance doesnt start to be paid until you have gone through underwriting and come out the other end. At this point you shouldnt have paid a penny to the insurance company and wont do so until you accept the revised terms. So, that brings us back to point 1. What was that fee you paid?

jonesMUFCforever

I would imagine that in the small print of the contract would be a clause 'subject to underwriting' or something similar.
You also don't make it clear whether you applied direct to the life assurance company or through an agent site such as moneysupermarket or its ilk.
If you are not happy then use your cancellation right and get a full refund and try somebody else.

Bear in mind though if asked you will have to disclose the conditions imposed on you through this policy.

dunstonh

You also don't make it clear whether you applied direct to the life assurance company or through an agent site such as moneysupermarket or its ilk.

I suspect its been bought on an execution only service like Cavendish where you pay them to submit your application on nil commission terms. That would explain the reference to fee rather than premium. Especially as premiums dont start until after underwriting and acceptance.