Feedback on our SOA please...

tigerfeet2006

arrowarra wrote: »

Thanks for all the feedback so far, it is really useful.

If we put £60 for phones down will that not put us over the limit as Ineedaname indicated that £46 was at the top limit Allowance for phones for family of 4 is £59 so £60 will swing it.. When people say that you are 'not allowed' things like cable TV or Internet does this mean that you are not allowed a budget for it but if you are willing to sacrafice some other money (ie groceries) to pay for it then thats fine Yes, that is about it.. Or if you do this and the OR goes through your bank account after BR and sees that you are still paying for these services will you be in trouble with the OR? The OR does not go through your accounts after BR unless he has reason to think you are stashing money etc. Also what you pay out for out of your allowances are your business.

We will reduce the Insurances with regards to PC Insurance.

Regarding Life Insurance - these are critical Illness policies for both my wife and I and if we are not diagnosed with a citical or terminal illness during the life of the policy then there is no payout. My wife is considering cancelling her policies in order to free up some extra money but how would this look to the OR? It's not an attempt to fiddle the OR out of any noney - we would hope that we never have to use them! But it would give us an extra £10 - £15 a month. Any suggestions or advice on this? As we are slightly confused by the rules regarding these types of policies.

If you keep them on after you go BR then the OR will vest in it and if you have to use them, when ever that may be then the OR will claim the money. You have several options, if they are a good deal and you won't get a better deal if you cancel and try for another after BR then I would keep them on and the OR will give you the option of paying £50 each and that means that if you claim on them during BR he will get the money and if you claim after BR then you get the money. You could stop paying them and pick up new ones after discharge and the OR will have no interest them.

That is how I understand it but someone will correct me if I am wrong.

arrowarra

Does this mean that if you have existing life insurance policies before you go bankrupt and they come into fruition during the course of your BR then you obviously have to hand all monies over, but if you take the policy out after the OR interview then you don't have to declare this policy at all??
I've read somewhere about having to 'buy back your interest in policies' from the OR after discharge but do not really understand the deal regarding life insurance? Could anyone shed any more light on it for me before deciding wether to cancel the policies or not.
Cheers

Ineedaname

Hmmm, that's interesting Tigerfeet, I thought if you buy the BI back then the OR has no further interest in that policy, even if during BR year still. So the OR only gets the payout if they still have BI in the policy, but once bought back then any payout belongs to the BR.

Would love clarification on that one.

arrowarra

I think you've just answered my question whilst I was typing it!!
So you don't think there will be any issues with my wife cancelling hers now, just a few weeks before court?

Ineedaname

I can clarify part of my last post which I just realised I got wrong. Of course the OR would have the money from any payout even after BI bought back from them. Because it's a windfall and they are entitled to any additional money the BR receives during BR year, nothing to do with it being insurance money, doh!

I think she'll be fine if she cancels it now. If asked she can always just say she was trying to cut back and didn't think she'd be allowed to keep paying for the policies during BR. At the end of the day, once it's cancelled there's not a lot the OR can do about it.

tigerfeet2006

If she cancels before the BR the OR will have no issue with it, so don't panic.

You got it INAN

arrowarra

Sorted! I think we will cancel all the policies in that case and add the £24 into our cothes budget, for the next 12 months at least clothes on our children's back and shoes on their feet will be of much more benefit!
I am hoping to post an ammended SOA up later with all the suggestions and advice taken into account and would appreciate a quick glance from you all through that.
Cheers

kepar

I can clarify part of my last post which I just realised I got wrong. Of course the OR would have the money from any payout even after BI bought back from them. Because it's a windfall and they are entitled to any additional money the BR receives during BR year, nothing to do with it being insurance money, doh!

Why?
That is why you pay the £50.
The money if paid out will not go to the br if you have paid.the money.
If you take out a new policy before AD then the OR will have claims.

Also if you cancel a policy and restart one, the payments will be higher as you will be older now than when you took out the original. If your health has changed then you would have to declare that Easier to maintain the policies and pay the money.

Ineedaname

Kepar, if you buy the BI back during BR year then yes, the policy is yours again. However, if there is a substantial payout then you are receiving money in excess of your needs for living expenses, so of course the OR is going to want that money.

Like I said earlier, once BI has been bought back it's not about it being insurance money, but purely about the OR having an interest in ANY money the BR receives.

Regarding taking out a new policy during BR year. I assumed the OR would not take the BI as the policy wasn't in force at date of BR. But the above still applies regarding any money paid out from the policy, the OR would want the money as it's surplus.

kepar

I think you are wrong, that is why you pay the money, otherwise what is the point.