AVIVA Life Assurance

D_O_S101

Morning Everyone,

Quick query that I'm hoping someone can help me with.

When we first purchased our house and took out a morgage like everyone else there was a life assurance policy attached to the morgage through Norwick Union (Aviva). 2 years later when the fixed rate finished, we remorgaged our house but opted to stay with Aviva for our life assurance as we were happy with the service. As part of the application for the new morgage our morgage broker had to resubmit our paperwork to Aviva to review cover etc and it came to light that my partner (now wife) had a medical condition not listed on the original life assurance policy and therefore they were not able to offer us the standard assurance policy but were able to offer us an ammended policy at a slightly higher price. We were happy with the new price as it was only a fractional increase in monthly cost.

This next part I know is our own fault but..... after recently reveiwing our bank statements it appears instead of ammending the original figure, they have infact created a totally new policy for us (new policy number etc) but for the same people, same address etc, and yes you've guessed it have been charging us for both the original policy and the new policy we took out 10 months ago.

The advice I need really is the best course of action to take now. Naturally I'm intending to ring them and explain the situation but what I really need to know is if there are any things I can do to increase my chances of recouping the amount they have been taking for the past 10 months for what is basically a duplicate policy. I'm slightly concerned that their attitude will be that it is infact our own fault for not cancelling the original policy, but as it was through the same company, for the same people at the same address I really didnt think it would be a totally new policy just an ammendment to our original one.

Thank you to anyone who is able to help or give advice with this matter.

dunstonh

The advice I need really is the best course of action to take now.

Simple, the new adviser should have told you to cancel the old one after the new one had been accepted.

Aviva themselves are not in a position to cancel policies for you. They need to be told to do it. However, you may well find that they will refund the premiums on the first policy during the duplication period if you contact them. Although they may refer you back to the adviser first and it may need a request from that adviser to get them to refund.

I really didnt think it would be a totally new policy just an ammendment to our original one.

Whilst most insurers can redraw the original policy, that would mean backdating it and you having to pay the increased premium over the whole term. Whereas creating a new one looks at that point going forwards. Again, the adviser should have made you aware of this. I am not going to totally blame the adviser here. I have seen people who have been told to cancel the old insurance both verbally and in writing fail to do so and later deny they were told and only when they were reminded and shown the evidence they they go "oh yes, so I was". However, a poor quality adviser could also fail to make you aware.

at this stage, I would suggest you go back to the adviser and get them to sort it. If they cant sort it then ramp it up to a complaint at that point.

kingstreet

D_O_S101 wrote: »

it came to light that my partner (now wife) had a medical condition not listed on the original life assurance policy and therefore they were not able to offer us the standard assurance policy but were able to offer us an ammended policy at a slightly higher price.

Can you clarify this for us?

Was the medical condition missed off the original application to NU or was it something she suffered after taking out the original policy?

If it's the former, a new replacement policy was probably a good idea to get away from the possibility of a claim decline for non-disclosure. However, if the latter, taking a top-up policy and leaving the exiting policy "in situ" may have been better value than a whole new policy when it was "rated" for the existing medical condition.

Please tell us more...

D_O_S101

To answer the two points raised.

It is entirely possible that we were advised to cancel the original policy, around the time of the remorgage we were in the final stages of wedding planning and as you can imagine things were rather hectic. However I dont seem to be able to find any infomation relating to this from the adviser.

To answer the second question. The medical condition was only diagnosed after the original policy was taken out.

dunstonh

To answer the second question. The medical condition was only diagnosed after the original policy was taken out.

This changes everything and well done to kingstreet for asking.

Life assurance applications are a snapshot of your current and known issues. If something happens down the road that was unknown about at the time of application, it does not impact on existing policies.

Whilst some plans do have an increment option known as guaranteed insurability. These are typically set up as second plans and not an adjustment to the original. So, you were always going to get a new plan.

The question this then leads to is whether the new plan is covering the difference in your financial need and you need both or is it a full replacement. e.g. if you need was £200k, does the new plan cover £200k. Or does it cover £50k with the old one covering £150k.

kingstreet

dunston's run with what I was thinking...

Look at the original plan for options to increase. These normally apply with marriage, childbirth, moving house or increasing mortgage.

You'll end up with a top-up plan as dunston says, but the medical condition won't have an impact as there's no medical underwriting at the point of exercising the option.

Ask Aviva.

OshayAway

Aviva don't have a GIO (guaranteed insurability option) to increase cover without additional underwriting. IMO, one of the main reasons not to use them.

Double check to be sure though. In any event, I'm pretty sure it has to be exercised within 6 months of the event, with proof of compliance with that criteria.