Unresponsive broker - what next?

waterbaby

We switched mortgages through a broker, the money moved in September. Originally we asked for it to move at the start of August, when our 'deal' ran out. The brokers said that the way they make their money is by us signing up to their life insurance. The policy was comparable to what we already had, so we switched.

We signed papers for this insurance, but now, I can't see any payments coming out for it. At the start of October I wrote to the broker to query the life insurance, and I also asked why it had taken til September to move the mortgage. A month later with no response, I wrote again, recorded delivery (and they got it), and have had no response in 13 days.

So what do I do next? I have tried phoning in the past, it's taken days to get hold of them (this is after we signed - it was great til then) and I just really don't want to speak to them anyway. We were recommended them by a financial adviser who I know well and do trust, shall I get him to have a word?

herbiesjp

Get a different adviser to do the life policy for you - or even a whole of market mortgage adviser.

Sounds like their customer service is a little shoddy

waterbaby

Can I change adviser now? I can't cancel the insurance for three years otherwise I have to pay (£3k, 2k or 1k depending which year). Am I stuck with the same adviser for the three years? I presumed I was. I'd love it if I wasn't.

AndrewSmith

The 3,2,1 penalty is with respct the mortgage not the insurance (I would guess).

You can usually change pure life cover provider without any penalty at all.

Have you actually cancelled your existing cover as you may be able to re-start it providing you make up any missed payments between stopping it and now (dependant on the life company and the T&C of the cover).

Who is the mortgage/life cover with?

herbiesjp

waterbaby wrote:

Can I change adviser now? I can't cancel the insurance for three years otherwise I have to pay (£3k, 2k or 1k depending which year). Am I stuck with the same adviser for the three years? I presumed I was. I'd love it if I wasn't.

At a guess I would say thos epenalties are linked to the mortgage and not the life policy.

Have a look at the T&Cs you may have signed with the advisers, as they may try and get some money from you if you do not proceed with the life policy.

You can change advisers whenever you want

HTH

AndrewSmith

Great minds herbs

herbiesjp

AndrewSmith wrote:

Great minds herbs

Note to self - must type quicker - lol:rotfl: :T

waterbaby

We have signed a piece of paper that says the broker's "charges for arranging the client's mortgage and carrying out all of the admin work is 2% of the total amount of your advance" (which is about £2k).

So I am wrong about the 321. But it goes on to say that they do receive a commission from the life insurance company;

"The amount of our charges therefore will be offset agaianst any commission and assuming you continue to pay your policy premiums for 36 months from the commencement date of that policy, then our charges would be offset in full and nothing would be payable to us by yourselves. This does not affect your statutory cancellation rights."

herbiesjp

Have you received any paperwork from them or the company- any policy documents?

waterbaby

I can't see anything directly from the insurance company (MGM). However, my partner was having some medical investigations and MGM contacted him to ask for the results. So they are aware of us. But no money is leaving our account

dunstonh

MGM is a strange choice of provider. Admittedly, life assurance isnt my main area of business but I cannot recall ever seeing them on the price quote portals. I know they operate a tied salesforce but its not a very big one.

If you have received no documentation, it could still be sitting in underwriting awaiting decision or awaiting documents regarding investigations. If the medical investigations are still ongoing, many insurers will not offer cover until investigations are complete (depending on area being investigated).

If you signed a fee agreement as it appears you have, then you are basically stuffed. However, if the commission for the mortgage covers it, then you are ok. However, that fee agreement also means that if the insurance commission is above 2% of the advance, with the mortgage commission, you should be rebated the difference.