Life insurance issues for 90 year old

csbeaumont

Hi all,

First post here about an issue we're having, not sure if there's a solution but this seemed a good place to ask.

We lost my grandfather 2 weeks ago, and are in the process of sorting out his paperwork, specifically life insurance policies to help out my gran who will now of course have to live and manage alone.

Most of the policies have this same issue, but the most egregious one is a policy we found that was opened in 1956 to pay out 35 (old style) pounds upon death, that has been paid into for decades since, and the insurance company are now claiming is still only worth £35 (new pounds!)

So basically in the massive amount of time it's been active, during which they've paid the company a fortune, not only has the payout not kept up or even remotely reflected these decades worth of contributions, but the payout has essentially been inflated away into worthlessness.

Is this legit? Having gone through boxes of paperwork it does appear that unfortunately my gran has a bad habit of signing whatever massively unfair paperwork a salesman places in front of her, so I'm not expecting anything, but this seems scandalous to me on a moral level.

Anyone have any experience or advice in this area?

Thanks
Chris (and family)

Owain_Moneysaver

Yes, it's legit.

You simply need to keep paying in every month throughout your life, as if you stop paying, your cover will end and you won’t get anything back.
Depending on how long you live, the cash sum paid out could be less than the total amount paid in premiums

Sun Life

Back in the 50s regulation of financial services was a lot less rigorous than it is now.

See also Martin Lewis's blog

Owain_Moneysaver

Incidentally, an old style pound is the same as the new style pound. It's only the old and new pence that were different (240 d. vs. 100 new p. to the £)

McKneff

Seems a bit strange, I took one of these £35 policies out for my dad, he died many years ago (about 23) and I completely forgot to claim it, never thuoght about it again till a couple of years ago when Coop contacted me saying they were going through the archives and were clearing up. I had to send a copy of his death certificate. I was then sent a cheque for over £400.

I

ACG

I have no idea where you stand on this so i wont comment on that side, but it is important to review whatever protection you have in place periodically.

things do change, policies improve, prices fluctuate etc.

I know that doesnt really help your situaion though.

dunstonh

Most of the policies have this same issue, but the most egregious one is a policy we found that was opened in 1956 to pay out 35 (old style) pounds upon death, that has been paid into for decades since, and the insurance company are now claiming is still only worth £35 (new pounds!)

If it was set up to pay £35 then it will pay out £35. New/old makes no difference in case of pounds.

So basically in the massive amount of time it's been active, during which they've paid the company a fortune

A policy of that type would be a penny policy. How much is this massive amount you refer to?

s this legit? Having gone through boxes of paperwork it does appear that unfortunately my gran has a bad habit of signing whatever massively unfair paperwork a salesman places in front of her, so I'm not expecting anything, but this seems scandalous to me on a moral level.

Yes it is legit. It 56 years ago. How do you know what your gran was like 56 years ago?

so I'm not expecting anything, but this seems scandalous to me on a moral level.

I am struggling to see anything wrong. The policy will pay out the sum assured that was paid for. Doing exactly what it said on the tin. How is that scandalous?

Seems a bit strange, I took one of these £35 policies out for my dad, he died many years ago (about 23) and I completely forgot to claim it, never thuoght about it again till a couple of years ago when Coop contacted me saying they were going through the archives and were clearing up. I had to send a copy of his death certificate. I was then sent a cheque for over £400.

A With Profits version will usually be sum assured plus bonuses. So, these can be well above the amount. A non-profit version will be cheaper in premiums but have nothing on top of the sum assured.

csbeaumont

dunstonh wrote: »

If it was set up to pay £35 then it will pay out £35. New/old makes no difference in case of pounds.

A policy of that type would be a penny policy. How much is this massive amount you refer to?

We calculated £1700 paid over his life, which, yes, I'm sorry to admit that I do find a scandalous amount for a company to take in policies when the payout is half a day's wages at minimum wage, I'm sorry that this offends you to the point you need such rudeness in your reply to a genuine and civil question following a bereavement..

Are you always this needlessly abrupt, personal and confrontational when people ask a question? I get it, you think we, or at least my grandparents, are a bunch of idiots for continuing to pay a company for decades after the sum paid out became irrelevant, and I'll be sure to tell my gran that captain hindsight tells her she should have checked the paperwork more often, but jesus christ man, I just said that we only lost him 2 weeks ago, a little bit of human decency rather than pouring scorn wouldn't have hurt you would it??

stephenni1971

csbeaumont wrote: »

Is this legit? Having gone through boxes of paperwork it does appear that unfortunately my gran has a bad habit of signing whatever massively unfair paperwork a salesman places in front of her, so I'm not expecting anything, but this seems scandalous to me on a moral level.

Anyone have any experience or advice in this area?

Thanks
Chris (and family)

You came he to ask a question when you already had the answer in your head.

Just because there wasn't a rush of people agreeing with you is no excuse to be angry.

There is nowhere to go with this - a poor 56 year old penny insurance policy is what it is, no more no less.

dunstonh

We calculated £1700 paid over his life

Is that a real figure or one you think it is? I don't think it will be accurate. It would suggest a figure of around £2.50pm was paid. It would be strange for someone in 1956 buying a policy costing £2.50pm or £30 a year to get a payout of £35. It would have paid for itself in 14 months.

That seems unrealistic and not how pricing of insurance works. So, I suspect you have miscalculated somewhere.

I'm sorry that this offends you to the point you need such rudeness in your reply to a genuine and civil question following a bereavement..

it doesnt offend me. It surprises me that you consider a policy that has a sum assured of £35 should pay out more.

Are you always this needlessly abrupt, personal and confrontational when people ask a question?

I asked you questions to find out what you feel was wrong. No need for you to go off on one.

I believe your information is wrong. I cannot see anyone paying £30 a year to buy a life assurance with a sum assured of £35. I cant see any insurance company pricing it like that unless the person had a life expectancy of under 12 months.

Just because I dont agree with your assumptions and think your reasoning is a bit off (such as making out your nan was mis-sold in 1956 which was 49 years before insurance regulation started), does not mean you have to be so angry. I suggest you check the figures again. He could easily have ended up paying more than it paid out. There is a risk of that. However, typically you wouldnt expect premiums to be any more than say £100 over the period.

boobbby

My mother has had a over Axa sunlife over 50 policy since she was in her fifties and she is now 91. Axa now dont take payments after the age of 90 for their new policies but to seem whiter than white they sell their older policies to Friends life so the payments can still be collected. Even though my mother can no longer afford the £7.50 per month she can't cancel or will lose all.

eranou

boobbby wrote: »

My mother has had a over Axa sunlife over 50 policy since she was in her fifties and she is now 91. Axa now dont take payments after the age of 90 for their new policies but to seem whiter than white they sell their older policies to Friends life so the payments can still be collected. Even though my mother can no longer afford the £7.50 per month she can't cancel or will lose all.

That's nothing to do with the Friends Life takeover they havent changed any of the original terms, some policies pay until your 90 some continue throughout life.