Life/Critical Illness Policy - help wanted

KML2076

Hi there

I have been a member of the site for a while but never really posted - the wealth of information here overwhelms me at times so please be gentle on the jargon with me!

I am currently doing a full review of my finances and have worked out that I should be able to get debt free in 31 months :T

As part of my review I remembered that I have been paying £7.62 per month to Legal & General but I wasn't really sure what it was for and could find no supporting paperwork.

I spoke with them today and it started coming back to me. Nearly 5 years ago I saw an IFA and ended up with a consolidating loan of £4k which I have now almost cleared. I also ended up with a Life & Critical Illness policy with Legal & General.

They are sending me through all the details but the gist of it is that its a £10k policy payable over 15 years. I worked out that I have paid about £442 to it so far and over the 15 years I will pay about £1370 in total.

I work for a large corporate and get a Life Insurance policy as part of my package with them and I'm only 33 so I'm not sure if its really worthwhile paying out to another policy.

I think at the time I received this advice I was in debt and scared by the whole thing and although the IFA found me the details on the consolidation loan he didn't get anything for that and wasn't charging me so I ended up signing up for a policy I didn't really understand or was sure was the best thing for me because I felt guilty he had helped me out for nothing.

Now I'm not sure whether I should keep paying into this policy or if I can even get out of it or what my options are. Any advice would be gratefully received!

KT

stephenni1971

You can keep it - in which case if you did suffer critical illness within the terms of the policy before it ended you could claim.

You can cancel it - in which case you would lose any potential benefit as above.


It could be stated that the advice to buy the policy was that in the event of the critical illness you may have been unable to make you payments so the lump sum provided would have cleared your debts and left a surplus.

You should never feel obliged or guilty about taking out a policy with ANYONE. If you don't want it don't buy it. That said you would have got a suitability letter and a clear right to cancel within a certain period if you were unhappy.

KML2076

Thanks - will wait for the replacement terms and conditions papers to come through and see what's what then.

KT