Repayment of Premiums - Advice needed

16pjwhite

Hi,

For just over 12 monts I had an insurance policy with Prudential that covered me and my girlfriend if anything happened to us. Our premium was taken out every month and we never missed a payment. Then about 2 weeks ago The Pru sent us a letter saying that our policy had been cancelled and that our premiums would be refunded, which they were. We did not ask for the policy to be cancelled.

They now say they made a mistake and can we repay the premiums and carry on the policy as they had covered us. Without talking to me they have sent documents about a new policy (AIDS check, Health check etc). I had started looking for new cover elsewhere.

I have said I am happy to carry on using the Pru but that I will not pay the premiums back. I have no qualms about getting a bit of extra cash out of the Pru but would like to know where I stand legally.

Can anyoine help?

DavidHM

They can't force you to pay the premiums back - they've canceled and unilaterally refunded the premiums.

However, the fact that the policy was cancelled would IMO be a material factor for any new insurer. That means you'd have to declare it, explaining the situation. This may mean that your premiums for any new policy are loaded and some may not cover you. Obviously if you explain what happened then some insurers might be happy to cover you but it will undoubtedly make things more complex.

So as I see it, you can either reinstate the policy or take the cash and have the original policy voided - but if you take the cash, the original policy has to remain void and that will probably have implications if you decide you want to take another policy later on.

16pjwhite

Thanks very much for that, I will give it some thought