Life insurance claim on joint policy

Avamay

Hey all

I'm new to here and am in need of some advice!

My ex is making a claim on our joint life insurance policy. He has MS. We have been separated for 2 years and still own a flat together, which we haven't managed to sell (hence the continuing payment of the life insurance).

I have a couple of questions:

1. Will this claim affect my chances of being able to get future life insurance/increase my premiums?

2. As i have been paying half the life insurance for the 2 years we have been separated, would i be entitled to half? I have been receiving conflicting advice from friends/family 'entitled to half to just walk away it's easier' - as he has been making my life a nightmare since the break up. He says 'over my dead body' when we've discussed me having half. I would just like to try and keep things fair.

Please Help!!!!
Thanks in advance

dunstonh

1. Will this claim affect my chances of being able to get future life insurance/increase my premiums?

No

2. As i have been paying half the life insurance for the 2 years we have been separated, would i be entitled to half?

No. Unless the policy was assigned then you both have a joint claim on the policy. However, the proceeds payable will need to go into a joint account or require your signature to release them into his sole name. So, you may have scope to request some payment. Although asking for half would be a bit steep. If its a mortgage related policy then maybe the insurance should be used to clear the mortgage. That way, when the property is sold, you get your agreed entitlement from that without having to pay off a mortgage first.

Avamay

Thanks dunstonh - My ex wants to clear the mortgage (which i agree with). He wants to then give me £5000 and he keeps the flat. He believes that it his claim and his money to be used for his MS. I do think half is steep. However, i'm not sure that £5000 is reasonable. He can be very forthright and i've done a lot of things in the past to keep the peace - I'm worried that he would never sell the property if he knew i wanted a bigger chunk than £5000.......

bouncydog1

I think that there are two issues here and that you should take advice from a solicitor regarding the property. I believe that you will need to take into account what the level of mortgage was, how much has been paid and what contribution by each party has been made to the time the mortgage is settled. An assessment of the property value at the time of settlement would also need to be made and agreement then be made between you as to what is a fair payment to you by your ex for your share of the property.

Presumably the life policy was put in place to enable the mortgage to be settled if one or other of you died or other, and will cease once the policy has paid out.

This is a complex situation and I do think that you really need to talk through the options with a solicitor to ensure that you are not treated unfairly.

lordhaldon

Hi. Sorry about the situation you are in as it appears to be a tough one. I am a firm believer that in these circumstances you put the Law to one side and agree a fair and equitable solution, which it sound's like you are aiming at. A solicitor can easily chew up £5k without any blinking of the eyes. You paid the premiums to cover you and the affliction has hit your ex. As you were also covered, ask yourself what you would give him - honestly - and aim to settle for that. Difficult but good luck. Hope this helps.

Avamay

Thanks Lordhaldon - Advice much appreciated!

magpiecottage

Legally, assuming the policy is in joint names it pays out jointly to you in the event of either of you claiming. It is unlikely that the lender has a legal right to claim on it because that requires something called an assignment which very few now bother with.

If you use it to pay the mortgage off then you will either own the house jointly under a joint tenancy or a tenancy in common (if you are in England or Wales). With a tenancy in common you will own it in proportions it specifies (not necessarily 50:50). If it ended up "over his dead body" you would get your percentage and his would go into his estate.

If it is a joint tenancy and he died you would get the lot.

If the property is sold you will get 50% of the proceeds (unless a tenancy in common indicates a different percentage) and he cannot sell without your consent.

Personally, I think selling your half for £5K makes no sense as I imagine, at the very least, it is worth at least five times that and probably very much more.

He also sounds like somebody who would not have sold his share to you for that amount if the situation was reversed.

If he is unwilling to move then, unless you are really desperate for £5,000, I would get the mortgage cleared and leave him there. When he eventually moves or dies the property can be sold and you can get your money back. If it is a joint tenancy and he dies then you would inherit it all!

If you do that, though, there is a risk that the sale may go ahead without your knowledge. I believe the Land Registry now has a scheme that will enable you to make it aware of your current address and it will contact you there in the event of somebody trying to sell (you need to keep it updated about subsequent moves, though).

If you do this, the ownership of the flat should not affect your ability to get another mortgage since there will be no outstanding debt.

Avamay

Thanks Magpiecottage -that's given me a lot to think about.....following my ex's offer of £5000 and my suggestion of a more reasonable amount, he has now stopped responding to me. So i think i may need to seek some further advice about where to go from here.

magpiecottage

In the first instance, get the claim in and the mortgage paid off. If you do not and the interest is not paid then the lender is likely to take possession and sell it.

You would then get the value of the policy ± any surplus/shortfall between the proceeds of sale and what you owed the lender but this would be more expensive than selling it yourselves and your credit history would be trashed in the process.

Good luck