Post Office Lifestyle (AXA) Insurance

MalG_2

I took out an insurance policy some 8 months ago primarily to cover against unemployment, accident and sickness. The policy appealed to me in that in the event of becoming unemployed it would pay out after 30 days. I had a letter sent to me yesterday informing me that "due to the recent difficulties in the financial markets and increased employment uncertainty" the previous 30 day waiting period clause has now been replaced with a 60 day 'Deferred Period' clause. In addition to this my preimiums will rise by £20. I was shocked that AXA could do this ! Should something awful happen I would have no income for 90 days and my home would be at risk. The choice is take it or leave it. All policies have a 90 day qualification period from the start date in which case I cannot go elsewhere!
Apparently this has been passed by the FSA!
Surely we count for something!

dunstonh

I was shocked that AXA could do this !

You shouldnt be shocked. You bought the product and should have been aware that it was reviewable and not guaranteed.

Apparently this has been passed by the FSA!

No it hasnt. The FSA has made no rulings or investigations in this area. There is no need to though as MPPIs have been reviewable for as long as I remember and reviewable contracts have never caused any issues or been subject to FSA review. Indeed, consumers benefitted when the MPPI rates fell in the good years after being much higher in the last recession. So, it was almost inevitable that premiums would rise during this recession.

Surely we count for something!

You cant have it both ways. If premiums go down in good years then its only fair to assume they will go up in bad years when the risks are higher.

MalG_2

Thanks for your post.
You appear to have an oppinion biased towards the insurance companies. This is not the policy that I originally took out. I had to qualify with 3 months of employment, now it seems I have to qualify for a further 3 months of unemployment before the policy would pay out.

Teresa Fritz, principal researcher at Which?, said the changes were "very, very unfair".

"This is not the way large companies should be working," she said. "This is not, or at least should not be, the nature of insurance. Companies should be pricing in bad times as well as good times."

dunstonh

You appear to have an oppinion biased towards the insurance companies.

No. I have an independent opinion knowing the pros and cons of the products and providers.

Teresa Fritz, principal researcher at Which?, said the changes were "very, very unfair".

doesnt mean anything. Which will say anything that improves their profile and sells more subscriptions. Remember Which? used to recommend endowments yet they now have template complaint letters (yet you cannot complain if you followed Which? advice). They jump from side to side whenever it suits them.

Companies should be pricing in bad times as well as good times.

In which case premiums would still be higher than they are now yet they are still lower than the last recession and when you consider inflation, that is very good.