Total(ly useless) Mortgage Protection Plan - Halifax

Funky_Gecko

My wife and I took out a TMPP with the Halifax 5 years ago when we signed up for a 7 years fixed rate mortgage. We were told by the advisor that the plan would pay out a lump sum in case of death, terminal illness AND in the event of myself being made redundant. This costs us £86 a month (yeah I know - V. expensive!) and we were told it was this high because of the high level of cover it offered (even though our mortgage is only £56k!). We were never offered any other option at the time when we took out the policy, i.e. use another PPP provider, that it was optional rather than necessary, etc.

We saw our advisor again in February after I was made redundant. We were again told by her that the redundancy payment WOULD BE A LUMP SUM and she commented on how lucky we were to have an older plan with the better provision/payout. She made quite a point of telling us how the 'new' plans were not so good and that ours also paid out 'extra' towards living costs, etc.

Having been made redundant at least they would pay out, or so I thought...

...For the last year I have been planning to start a business; investing what savings we had with the intention that I would continue working through the week in my day-job (and paying the mortgage) whilst working in our business in the evenings and weekends until it hopefully took off in a couple of years. The cost of setting up the business far, far, exceeds any income from it for at least the first 2 years - as is the case with most business start-ups (£40k to set up, less than £4k income this season).

We have now been told that;
(a) the cover will not pay out a lump sum for redundancy and that it was our mistake and not the banks (the advisor won't return our calls!)...
(b) we should have checked what the advisor had said against the 'small print' (Yeah right, how many people do that?!) and...
(c) because I am starting a business I am now regarded as self employed, even though we will make a projected loss this year in excess of £30k, and they won't pay out at all!

Perhaps I should just delay starting the business for a year and sign on the dole every fortnight!

Any comments that would help me see a bit more clearly would be appreciated.

Thanks

Dave

di3004

Funky_Gecko wrote: »

My wife and I took out a TMPP with the Halifax 5 years ago when we signed up for a 7 years fixed rate mortgage. We were told by the advisor that the plan would pay out a lump sum in case of death, terminal illness AND in the event of myself being made redundant. This costs us £86 a month (yeah I know - V. expensive!) and we were told it was this high because of the high level of cover it offered (even though our mortgage is only £56k!). We were never offered any other option at the time when we took out the policy, i.e. use another PPP provider, that it was optional rather than necessary, etc.

We saw our advisor again in February after I was made redundant. We were again told by her that the redundancy payment WOULD BE A LUMP SUM and she commented on how lucky we were to have an older plan with the better provision/payout. She made quite a point of telling us how the 'new' plans were not so good and that ours also paid out 'extra' towards living costs, etc.

Having been made redundant at least they would pay out, or so I thought...

...For the last year I have been planning to start a business; investing what savings we had with the intention that I would continue working through the week in my day-job (and paying the mortgage) whilst working in our business in the evenings and weekends until it hopefully took off in a couple of years. The cost of setting up the business far, far, exceeds any income from it for at least the first 2 years - as is the case with most business start-ups (£40k to set up, less than £4k income this season).

We have now been told that;
(a) the cover will not pay out a lump sum for redundancy and that it was our mistake and not the banks (the advisor won't return our calls!)...
(b) we should have checked what the advisor had said against the 'small print' (Yeah right, how many people do that?!) and...
(c) because I am starting a business I am now regarded as self employed, even though we will make a projected loss this year in excess of £30k, and they won't pay out at all!

Perhaps I should just delay starting the business for a year and sign on the dole every fortnight!

Any comments that would help me see a bit more clearly would be appreciated.

Thanks

Dave

Hiya Dave

Welcome.;)

Blimey you have been ripped off here haven't you ?:eek:

Write to them as soon as possible and complain and reclaim, this just isn't on !!!!!

They have also treated you unfairly here, you need to mention that as well, you have been given misleading advice also, write everything in the letter to cover your case.

With help from this link here:
http://www.moneysavingexpert.com/reclaim/ppi-loan-insurance

They have 8 weeks to respond in full.
Keep on at them, because if you receive a standard fob off response or they have not resolved this in your favour, you may be given the opportunity to write back to them.

Also in the final response from them, they should give you details on how you can take this further, generally with the FOS if eligible.

Good luck with this Dave, I feel for you and with the business you were hoping to start, its just not fair is it ?

If you no longer have the agreement for this, try asking for a copy of this, although if its longer than 6 years, it may be more difficult to retrieve, but worth trying anyway.
Most though charge a £1 postal order or cheque payment for this request, and they should sent to you by 12 days of requesting this.

Good luck and post up for help when needed.;)

dunstonh

We were told by the advisor that the plan would pay out a lump sum in case of death, terminal illness AND in the event of myself being made redundant.

There is no plan that does that. A package of plans could do those but not one indvidual type.

This costs us £86 a month (yeah I know - V. expensive!)

£86 isnt much as far as protection goes but it will be expensive as buying from the banks always is. Plus the products tend to be lower quality as well.

we were told it was this high because of the high level of cover it offered (even though our mortgage is only £56k!).

Sales patter. However, not something you can complain about as you were sold to by a sales rep who can only offer their own products.

We were never offered any other option at the time when we took out the policy, i.e. use another PPP provider, that it was optional rather than necessary, etc.

And you shouldnt be. You saw a tied sales rep. They are not allowed to offer, discuss of comment on the products of other providers. If they did, they would break the rules.

We saw our advisor again in February after I was made redundant. We were again told by her that the redundancy payment WOULD BE A LUMP SUM and she commented on how lucky we were to have an older plan with the better provision/payout. She made quite a point of telling us how the 'new' plans were not so good and that ours also paid out 'extra' towards living costs, etc.

Lump sum payments are only made on death, terminal illness and critical illness (when included).

We have now been told that;
(a) the cover will not pay out a lump sum for redundancy and that it was our mistake and not the banks (the advisor won't return our calls!)...
(b) we should have checked what the advisor had said against the 'small print' (Yeah right, how many people do that?!) and...
(c) because I am starting a business I am now regarded as self employed, even though we will make a projected loss this year in excess of £30k, and they won't pay out at all!

a) - Unless you have proof of this then you are not going to win that point. Even the most basic sales rep or adviser should know that redundancy cover is paid monthly. The only exception would be a trainee but they should be under supervision. Bank staff without full licences are prone to guessing but again, the balance of probability (which is used when no proof exists) is that you misunderstood, misheard or are making it up.

b) The adviser is required to document your needs and then make recommendations to match those needs. These are then put in writing. If there is something you dont understand then it is your responsibility to say so. They cant second guess what you may be thinking. I cant see a complaint going anywhere on that point.

c) Correct. You are not unemployed so why should they pay out? You will get nowhere on a complaint on that basis.

Perhaps I should just delay starting the business for a year and sign on the dole every fortnight!

Yes. That would be what is expected to happen if you are unemployed. However, you would also be expected to provide evidence of trying to get a job.

Blimey you have been ripped off here haven't you ?:eek:

I dont see it. Yes the products are expensive but its a bank and thats normal. Yes its their own products but its a tied agency so it would be. If you want whole of market you dont go to your bank. Yes the advice is basic but the tied agent remit isnt as stringent as IFA so its no surprise the quality of information is not as good. However, apart from the potential misunderstanding, there is no case to answer and that misunderstanding is going to be damned near impossible to get upheld without evidence.

You may have been told that but you will need proof as I cant see the complaints handler at halifax believing it and the FOS, if you take it that for, are going to have to make a balance of probabilities decision and I cant see them believing it either. Only exception perhaps would be if you were sold to be a trainee. I would imagine they would look at the length of authorisation the seller has held.

That is the only area of potential mis-sale in your post. All the other points are not things you can complain about.

Funky_Gecko

Perhaps we should just treat all 'Advisors' as either liars or simply incompetent; record every meeting, question every single word in the small print (how long would that take?), ask for minutes to be taken, seek a second opinion, take a Lawyer with us, etc.

We rely to a certain extent to be given honest and qualified advice, anything we are not sure we ask about and we did this yet again in February. The crux of this matter is that we were misled, either intentionally or unintentionally (I actually believe the latter and realise that its a no-win situation).

You are wrong to state that I am not unemployed as I am only in the planning and setting up stage of trying to get a business 'off the ground' and not yet trading. Surely even an IFA would not penalise people for 'thinking' about things? I am actively job seeking, I need to work to pay the mortgage and support the business, ONCE IT STARTS, until it can be profitable - would you have advised me to leave work and have no income? How simple is that to understand?

It would be a different matter of course if we were accepting business but we are not - we don't even have the equipment we need so how can I be self-employed with no equipment, not allowing customers, no income...?

Just because I might dream of winning the lottery doesn't make me a Millionaire!! The Benefits Agency would have a field day with that idea!

BTW : The Jobcentre DOES allow people to sign on when planning a business as they realise that you can have a small start-up business AND have a job at the same time. Also, the Benefits Agency recognise this with Tax Credit claims, if you earn £30k a year from a job and make a £10k loss on a business your 'earnings' are regarded as £20k. Neither of those agencies have a problem with it, so why the banks?

di3004

dunstonh wrote: »

There is no plan that does that. A package of plans could do those but not one indvidual type.



£86 isnt much as far as protection goes but it will be expensive as buying from the banks always is. Plus the products tend to be lower quality as well.



Sales patter. However, not something you can complain about as you were sold to by a sales rep who can only offer their own products.



And you shouldnt be. You saw a tied sales rep. They are not allowed to offer, discuss of comment on the products of other providers. If they did, they would break the rules.



Lump sum payments are only made on death, terminal illness and critical illness (when included).



a) - Unless you have proof of this then you are not going to win that point. Even the most basic sales rep or adviser should know that redundancy cover is paid monthly. The only exception would be a trainee but they should be under supervision. Bank staff without full licences are prone to guessing but again, the balance of probability (which is used when no proof exists) is that you misunderstood, misheard or are making it up.

b) The adviser is required to document your needs and then make recommendations to match those needs. These are then put in writing. If there is something you dont understand then it is your responsibility to say so. They cant second guess what you may be thinking. I cant see a complaint going anywhere on that point.

c) Correct. You are not unemployed so why should they pay out? You will get nowhere on a complaint on that basis.



Yes. That would be what is expected to happen if you are unemployed. However, you would also be expected to provide evidence of trying to get a job.




I dont see it. Yes the products are expensive but its a bank and thats normal. Yes its their own products but its a tied agency so it would be. If you want whole of market you dont go to your bank. Yes the advice is basic but the tied agent remit isnt as stringent as IFA so its no surprise the quality of information is not as good. However, apart from the potential misunderstanding, there is no case to answer and that misunderstanding is going to be damned near impossible to get upheld without evidence.

You may have been told that but you will need proof as I cant see the complaints handler at halifax believing it and the FOS, if you take it that for, are going to have to make a balance of probabilities decision and I cant see them believing it either. Only exception perhaps would be if you were sold to be a trainee. I would imagine they would look at the length of authorisation the seller has held.

That is the only area of potential mis-sale in your post. All the other points are not things you can complain about.

Hi

Glad you posted, I was a little confused on this one, you have more experience dealing with these actual issues, thank you.;)

Good luck with this Funky Gecko, I'm sure Dunstonh will help you through this matter.;)

Funky_Gecko

Quick update - I have just checked with the Jobcentre AND the banks insurance firm. Both say that it is OK to plan/start up a small business and claim as long as:

a) I work less than 16 hours per week (chance of working more would be a fine thing, I'd prefer to stand on my own two feet but as the business will be seasonal it'll be a slow start!). Most of this 'work' will be networking, planning, and seeking advertising.

b) The Jobcentre will sign an ABI1 form for me as long as I continue looking for work (which I am, desperately). I also need to be aware that I tell them of any training or voluntary work that I do (worked for 28 years so being at home twiddling my thumbs whilst waiting for the phone to ring is not my preferred option, I may as well do something beneficial for myself/others).

c) The Insurance Firm receive the authorised ABI1 form each month.

d) I report any changes immediately.

A happier ending! Hopefully I won't need to claim for long.

Thanks for the constructive, both positive and negative, comments. Really useful.

dunstonh

Perhaps we should just treat all 'Advisors' as either liars or simply incompetent; record every meeting, question every single word in the small print (how long would that take?), ask for minutes to be taken, seek a second opinion, take a Lawyer with us, etc.

Many take that is view of consumers who are increasingly putting in try it on and fraudulent complaints. However, regardles of your opinion every meeting does have a record of facts and needs and a report issued explaining the needs and the products sold along with a summary of features. Thankfully, they do serve to protect advisers from fraudulent consumers as well as protecting consumers. This is why there isnt the volume of upheld complaints on advised PPI products as there is those sold by those who are not regulated and authorised.

Thanks for the constructive, both positive and negative, comments. Really useful.

Its not being negative. Its pointing out that some of your issues had no chance of success because you didnt buy from an IFA but a tied agent. Therefore the complaint would be measured on the remit of a tied agent and not IFA. Also your accusations would need proof. It is possible you were told what you were but you could also be making it up. In cases where there is no documentary evidence available a balance of probability decision needs to be made and when you look at what you are saying it isnt likely to fall your way for the reasons already covered. If you had that proof it would be upheld.

Funky_Gecko

Just out of curiosity, if a customer of yours wanted to record each and every meeting with you, would you allow it?

dunstonh

Funky_Gecko wrote: »

Just out of curiosity, if a customer of yours wanted to record each and every meeting with you, would you allow it?

Yes. It would be a pointless thing to do though as the factfind and suitability report are all that is needed. One contains the data, the other contains the reasons why and risk warnings. These are the two documents that the complaints team and FOS would look at to judge suitability. You dont really need anything else as they do the job fine.

gigapig

I really hope you get a payout soon Funky Gekco, I have TMPP with the halifax and I was made redundant back in November.

I made a claim straight away and have done everything properly through the jobcentre. Because I was in receipt of "Lieu of Notce" from my last employer I had to wait 12 weeks to just send in my claim forms.

There was then a 30 day excess period and after that I needed to provide confirmation from the employment service that I have continued to be registered with them for another 30 days.

Three weeks ago I sent the Halifax an AB1 form (this is proof that I am still looking for work) which I can get when I sign on. I rang the Halifax today to see how my claim was going and the girl said all she could tell me was the claim was being assessed and I should know in a few days:rolleyes:

So 6 months and still waiting for a payout, my bank account can't take many more mortgage payments. Is TMPP worth it? not if you find a job quite quickly, and if you don't, well, I'm waiting to see.

I paid my premiums every month and I'm still paying those premiums, all I get from the Halifax is delay after delay.
There on hold message is the best, with phrases like "Assistance when things go wrong" and "Protection for your family".

I wouldn't recommend Halifax products to anyone, my advice would be to look over these products very carefully before wasting your money.

Thank you.