Misselling of life cover

Dai_Rob

Can I please ask for advice on this..

..My parents had a secured loan on their house to cover debts on a business they used to have (local bakery, sadly now closed). As part of the mortgage they were told they had to have life cover and the loan would not be granted without it.

Two years into the loan, they closed the business and paid off the loan. They were then advised to continue the life cover for the remaining eight years (ten year loan and cover period).

At the end of the cover payment period the payments stopped and they were left with nothing.

Q. Is there anything that would relate to this 'miss-selling' (IMHO) of life cover? They were pretty much forced to take the cover as they needed to take the loan out to help with the business (sadly, in hindsight, they wish they hadn't taken the loan out and just closed the business).

The loan was taken out back in approx 1999.

Thank you in advance for any constructive advice.

dunstonh

As part of the mortgage they were told they had to have life cover and the loan would not be granted without it.

Very common with businesses and allowed.

Two years into the loan, they closed the business and paid off the loan. They were then advised to continue the life cover for the remaining eight years (ten year loan and cover period).

What was the reason for the advice? (could be plenty of valid reasons. Especially if it was their only life cover)

At the end of the cover payment period the payments stopped and they were left with nothing.

Good. The alternative would have been one of them having died. Pretty fair to say that they would chose life over death.

Q. Is there anything that would relate to this 'miss-selling' (IMHO) of life cover?

Cant see anything wrong in what you have said so far. Why do you think it was mis-sold?

They were pretty much forced to take the cover as they needed to take the loan out to help with the business (sadly, in hindsight, they wish they hadn't taken the loan out and just closed the business).

As said, that is allowed. it was also common sense as they clearly had a financial need for it.

Dai_Rob

Thank you for the reply.

The reason (towards the bottom of your replies) for the belief of misselling is that they didn't believe it was necessary in terms of the loan, or their age (at the time of taking the loan out).

Again, thank you.

magpiecottage

Dai_Rob wrote: »

The reason (towards the bottom of your replies) for the belief of misselling is that they didn't believe it was necessary in terms of the loan, or their age (at the time of taking the loan out).

One of my Cubs lost his Mum a couple of years ago. She was quite young but not as young as him - he was eight.

dunstonh

The reason (towards the bottom of your replies) for the belief of misselling is that they didn't believe it was necessary in terms of the loan, or their age (at the time of taking the loan out).

1) it was necessary as the bank required it (no mis-sale there)
2) it was necessary as they had a joint debt that the other was liable for on death (so financial need existed)
3) age is irrelevant.

~Brock~

Dai_Rob wrote: »

Thank you for the reply.

The reason (towards the bottom of your replies) for the belief of misselling is that they didn't believe it was necessary in terms of the loan, or their age (at the time of taking the loan out).

Again, thank you.

So let me get this right....you believe that life cover was mis-sold on the basis that your parents are still alive?

I've got life cover myself, do you think that I should bang in a complaint also?