Swinton - 'Free Life Insurance'! - Be warned!

uva_caresi

I received a letter from Swinton last week offering me 'Free' 5 year £1,000 benefit Accidental death insurance. If I do nothing then the policy starts immediately. So I have to actually contact them to decline the policy - how bizarre that, because Swinton decide to do something I then have to react to this, it's almost an invasion of privacy! Now, you'll also excused me for being a tad wary, but in my experience no company gives away anything!

So I read the small print and under section 2. headed 'Operation of cover' it clearly states that if you have more than one Swinton Accidental Death Benefit Insurance policy then at the time of a claim then the benefit is paid under this policy and one other. Now I'm assuming that if a life policy pays out via an accidental death it is classed as an Accidental Death Benefit Insurance Policy - Can any IFA's confirm this or otherwise?

Now I have no Accidental death policies with Swinton. However I do have policies with two other companies. So at this moment in time it is not a risk to me. But what about others that may have two policies via Swinton that have not read the small print and are paying monthly premiums into say two £100K benefit policies? Well if you've received this unsolicited offer and done nothing then in the event of a claim in the next 5 years you've just reduced your benefit from £200K to £101K.

This is a significant reduction in potential benefit. How can this possible scenario be allowed to be created as a result of Swinton deciding to provide a free benefit! It's not free if it could cost £99K as in my scenario.

What if Swinton were to buy another insurance company in the next 5 years. Would those life/accidental death policies from the company purchased be included in the 'this policy and one other' scenario as used in the wording in the small print.

Has anyone else received this offer from Swinton?

Would any IFA's wish to comment on the legality of the offer from Swinton?

My layman's advice is not to accept anything offered as free.

My layman's frustration is that I would like the unsolicited nature of these types of contracts changed. The insurance companies should write to us and offer us to 'opt in', rather than engaging us in contracts unless we 'opt out'.

I'll be writing to Swinton to express my views in the strongest terms and also to my MP to see if he can apply some pressure to have legislation put in place.

TTFN

stephenni1971

Swinton cannot impose any conditions or restrictions on any other policies you may have.

What they ARE saying is that if for any reason you qualify for THEIR accidental death benefit more than once then they will apply a restriction.

Don't go off to your MP or anyone else - you have nothing to worry about.

magpiecottage

Accidental death cover is a general insurance policy.

It is not something an IFA is likely to sell because it only pays out on accidental death. It does not pay out if you die of natural causes, are unlawfully killed, suffer misadventure or nobody can tell - essentially, only if a coroner rules that your death was accidental.

It is very cheap (to the extent that it is sometimes given away) because of this.

Take the free cover as a bonus to your loved ones if you step over a cliff in the fog but don't rely on it to protect them in the event of your early demise.