Skandia Plans Life Insurance

pilgrimmike

In the mid eighties my husband and I, before we met, and quite independently, were sold Skandia Plans, life insurance. They were sold to us on the basis that provided we met the minimum monthly payment of £15.00, our respective estates would receive the sum assured of £50,000 whether we died the next month or aged 100! The schedules duly arrived and each stated the sums assured.

We have duly paid the premiums on time since. Mike over the years has increased his premium to £23.10 and sum assured to £115500.00. Earlier this year he received an annual statement and the usual option to increase the cover in line with inflation, only this year to keep the present sum assured the premium was to rise to £128.28 pm or he could reduce the cover to £20191 and still pay the same premium! This too would only be guaranteed for the next 5 years!. This is outrageous. NEVER was it suggested to either of us that the sum assured could go down. We are also now told that we are only guaranteed to be repaid 75% of the premiums that we have paid. Neither of us would EVER have taken a policy of this nature out.

We have contacted the seller of his Policy who deny any responsibility as the policy was taken out before 1988 when the FSA came into effect. We have also contacted Skandia who have only referred us to the seller

We would appreciate hearing from anyone in a similar position or anyone who can offer any suggestions as to the way forward.

Thanks

Viv & Mike

dunstonh

NEVER was it suggested to either of us that the sum assured could go down.

It would only go down if you wanted it to go down. If you dont want it to go down you pay the required premium.

We are also now told that we are only guaranteed to be repaid 75% of the premiums that we have paid.

You are lucky to have any such guarantee. Most of these life assurance plans build up very little in the investment element unless you have them set for a low sum assured.

Neither of us would EVER have taken a policy of this nature out.

These plans are very obsolete and old fashioned but then you did take them out over 25 years ago and they were quite common back then.

We would appreciate hearing from anyone in a similar position or anyone who can offer any suggestions as to the way forward.

Its pre-regulation so there is no consumer protection. Not that there is likely to be too much wrong as even if there was protection, it would be based on the rules in place in the year it was taken out. Skandia have no liability as they didnt sell it. The broker that sold it has no liability as its pre-regulation.

Your only option is court action but that is likely to fail as you are unlikely to have any evidence to support your claims yet the documentation will make it clear what the terms were. Plus, its over 15 years so a timebar could be activated.

Going foward, the best option is to get it reviewed against modern alternatives as, unless you are in poor health, the modern versions will almost certainly be better value for money.