Axa Multiplan

Daisey

20 years ago when we bought our current house we took out an Axa Multiplan policy for my husband, as well as an endowment to cover the mortgage (and yes, we did get compensation for misselling of the endowment). Over the years when Axa wanted to put up the premium we have sometimes opted to keep the premium the same and reduce the cover.

The current situation is
Premium £84.22 per month
Life cover £59452
Lifecare £29726
Value £1907.62

My husband is nearly 66 and I am 59, the house is paid for, and we have worked out that with other savings and pension income, if he were to die before me I wouldn't really need this money. We don't have any children, so don't need it to go into our estate either.

We have just received the policy review statement, and they want to change the premium or cut the cover again.

For about the last year we have considered cancelling this policy. Would this be a really bad thing to do, and do we have any other options?

Thanks

dunstonh

Would this be a really bad thing to do

Depends on how it compares to other options and your current scenario.

Most of the time, modern alternatives offer better value. Its only when you are in poor health and still have a life assurance need that they can be worth keeping.

Daisey

Thanks dunstonh.

We are both in good health, and if we cancel we probably won't replace it with anything. It just seems a pity that we have paid into it for 20 years and won't get anything back, but I suppose that's what whole of life means.

I think when we took it out we were more worried about him dying within the first few years, and although the mortgage would have been covered by the endowment, this was to give me something to replace his income with. We should have looked at cancelling it earlier, and at least we would have saved more by not paying the premiums.

dunstonh

It just seems a pity that we have paid into it for 20 years and won't get anything back, but I suppose that's what whole of life means.

Its like any insurance. If you dont claim, you think its a waste. If you do claim then you think its a godsend.

I think when we took it out we were more worried about him dying within the first few years, and although the mortgage would have been covered by the endowment, this was to give me something to replace his income with. We should have looked at cancelling it earlier, and at least we would have saved more by not paying the premiums.

these plans were the norm in the 80s but started to go obsolete by the very early 90s. Level term assurance and family income benefit plans were more common by then. So, you had the right idea and the product was just about right at the time. You are right to review these plans though and if you dont need it anymore then there is no point paying for it.