Need urgent help with life insurance

boys

While searching for a better deal for our life insurance & critical illness cover, we were offered better monthly premiums by a telephone broker. We were initially accepted (by the same company as our existing policy), so he arranged to cancel the existing policy. I assumed the cancellation would only take effect if and when the new policy was finally confirmed. However by the time we had to return the Statement of Facts documents to the insurance company, I had been to my GP and received 3 referrals, which I then disclosed to them. Due to these referrals, the insurance company withdrew their offer to cover. We are worried sick about having no life insurance in place now. Can we have the previous policy re-instated? What should we do next?

kingstreet

Under no circumstances should the existing policy have been cancelled until you were in receipt of the acceptance terms for the new cover.

You may be able to reinstate the cancelled policy by paying any missed premiums. This will normally be possible for upto three months. After that, the policy lapses.

I would caution you that if outside a month, the insurer will probably require completion of a declaration of health, which will put you back to square one, the same as the situation you face with the new cover.

Get on the phone to the insurer, now.

I would also suggest a complaint to the firm you were using to arrange the new cover. Pathetic lack of knowledge and care for their customer in my opinion.

ACG

I agree with kingstreet. I pay a company to do my compliance work and they make it crystal clear the existing policy does not get cancelled until the new was in in force for precisely this reason.

If they have done, then i would think you can get them to pay the difference between what you were paying and what you would have to pay for the remainder of the term if you were to take it to the financial ombudsman.

dunstonh

Rule number one in rebrokering life assurance (or other contracts subject to underwriting) is that you never cancel the existing policy until you have the new one accepted. It is a likely mis-sale if you were advised to cancel before getting the new one. If you did it yourself, then unfortunately, that is your fault. Although if this is an advised case, the adviser should have at least issued the warning.

As mentioned above, you may be lucky and still within a period of reinstatement where you do not have to make a medical disclosure. Usually these are 30 days but some may go on a little longer. After which, you can usually still reinstate but subject to a health declaration. Seeing as the same provider has rejected you for cover, it would be unlikely they would accept that.

boys

Thanks for all the advice folks. We rang our insurer and explained everything to them. The man on the phone seemed reluctant at first but after speaking to his supervisor thankfully told us he was reinstating our old policy.
This could have gone horribly wrong and we were only trying to change policies to take advantage of the fact that my hubby has quit smoking.

Anyway thanks again for your help:)

magpiecottage

boys wrote: »

This could have gone horribly wrong and we were only trying to change policies to take advantage of the fact that my hubby has quit smoking.

That sort of stress would be enough to make him start again!

You should complain to the broker. Even though you have managed to resolve the problem, you should seek redress for the "material distress and inconvenience" (a FOS term) that you have suffered. It won't be megabucks but I would expect £50 to £100.

ACG

Also, depending on the insurer im sure some of them would be ok at ammending the terms to non smoker rates....however i think in the circumstances its probably best to not upset the apple cart.

OshayAway

ACG wrote: »

Also, depending on the insurer im sure some of them would be ok at ammending the terms to non smoker rates....however i think in the circumstances its probably best to not upset the apple cart.

The vast majority - all bar one to my knowledge - will not amend a current in force policy to non-smoker rates. Rather, a new application would be required.