Forced to buy life insurance when getting a loan!

Lucyloo2_2

Does anyone know if it is possible to reclaim life insurance f you were forced to buy it so that you could get a loan. They refused to give me the loan unless I got life insurance, despite me saying I had a guarantor! Can I claim my money back?

maxdp

Was it purely life insurance? Which company was this through. Was it a secured Loan?

marshallka

Lucyloo2 wrote: »

Does anyone know if it is possible to reclaim life insurance f you were forced to buy it so that you could get a loan. They refused to give me the loan unless I got life insurance, despite me saying I had a guarantor! Can I claim my money back?

Hi,never heard of this one TBH? IF you really did not need it did you tell them so at the time and give them proof of being covered elsewhere?

Lucyloo2_2

I was taking a loan out from my bank and it was the same bank that wouldn't give me the loan unless I took out life insurance at this point they sold me their own life insurance. I has just finished uni at the time and didn't know much about the ins and outs of it all. I still feel like I didn't need it at the time as my dad said he would be my guarantor, it was only a £5000 loan.

Lucyloo2_2

They weren't having any of it and simply said I couldn't have the loan without the life insurance

maxdp

Lucy Loo was this just Life Insurance. If they indeed said you could not have one without the other then you probably have a case. Was it payment protection so you would be covered if you died or were ill or had an accident.

marshallka

Lucyloo2 wrote: »

They weren't having any of it and simply said I couldn't have the loan without the life insurance

Was the life insurance a monthly payment that you could have cancelled or a lump sum payment (single premium) ?

Lucyloo2_2

They definitely said that I couldn't have the loan without taking life insurance incase I died or had an accident and couldn't pay back the loan. I can't remember if they used the exact words ppi but that was why I had to get it. It was a monthly charge of £7 and could only be cancelled once my loan had been paid off. But I managed to cancel it before then aS I asked them again about it a few years later and they said I never needed it in the first place.

maxdp

So it was not just life insurance. When you cancelled the PPI or insurance did they re finance the loan.?

Money_mad_4

You have probably signed a contract and so its legally binding. Most lender are regulated by the FSA and as such they are supposed to explain every thing to you and you then sign to say that you understand whats been said. If this is the case, you havent got much of a case. You could take advice from the FSA.

maxdp

If it was front loaded PPI then yes you could claim because it is now seen as bad practice and stand alone PPI is considered to be better as you can cancel it without re financing the loan.

What they are supposed to do and what they do are two different things if you were told you could not have the loan without the insurance then you have been miss sold and you have a case.