Life Insurance payouts with Royal Liver

Julie63

Didn't realise Royal London had acquired Royal Liver until we made a claim on my Mother's life insurance last month. My Father passed away in 1984 and the same policies realised almost £2000 - now they are paying less than £500. One policy taken out in 1948 for £41.85 life cover, (Industrial Branch), paid £51.11.

kingstreet

Yep. Royal Liver was in the "do-do" and had to be bailed out. Royal London came along and took them over.

http://www.thisismoney.co.uk/money/news/article-1723280/Ailing-Royal-Liver-reaches-out-to-Royal-London.html

Policyholders in the stricken Royal Liver friendly society have paved the way for a takeover by the mutual insurer Royal London.

The move will calm concerns over Royal Liver's ability to honour financial commitments to its 900,000 with-profits policyholders.

Julie63

Would be interesting to know if bonuses already allocated over the past 30+ years can be removed once they've become free policies.

kingstreet

They can't.

Once allocated, an annual bonus becomes as guaranteed as the guaranteed sum assured. It's only the terminal bonus, paid sometimes on surrender, but always at maturity, that can vary widely.

Going back to my with-profits days in the 80s and 90s, there were providers reputed to manipulate their terminal bonus figures to get to the top of the Money Management payout tables every May. IIRC there were one or two where the total payout was over 50% terminal bonus.

lynblu_1

my mum took out a Royal Liver Assurance policy for me in 1957 (when I was born) and has paid into it constantly until it became a 'free/paid up policy'. I realised I would probably have to supplement this policy, not having a clue how much it would be worth. My mum did some ringing round & managed to get a figure..... 'Death Claim Value £25.71 (waiver)' that can't be right, surely. I know she's been paying into the policy for about 50 years!!

dunstonh

I know she's been paying into the policy for about 50 years!!

How much did she pay into this penny policy over the 50 years?

lynblu_1

wouldn't like to hazard a guess but helluva lot more than the £25! We were aware there would be a shortfall & that we (myself & 2 younger brothers) would have to take out further cover to get anywhere near the sum that's needed these days to cover funeral expenses, but £25 is a joke. My mum (and times were hard due to circumstances I wont go into) always maintained to pay the policies believing it would be one less worry for us as we got older. The insurance man used to collect regularly until it became a 'free, paid up policy' and for what ......:(

dunstonh

wouldn't like to hazard a guess but helluva lot more than the £25!

If the premium was say 2p a month then over 50 years that would be £12. So, it isnt likely to be a hall of lot more.

but £25 is a joke.

It wasnt 50 years ago. However, that is why they were known as penny policies. That is inflation for you.

The insurance man used to collect regularly until it became a 'free, paid up policy' and for what ......

Because sending someone round to pay a few pence is not cost effective. So, its cheaper to make it premium free.

haras_nosirrah

pay pennies in, get pennies out

find out how much your mum was paying but some of these policies were 1p a month premiums

MIKE770

When my Mother died in early 2002, we found the old 1p known policies from 1940s/50s, we contacted Royal Liver who had no record of the policy numbers (collector use to collect at the door), they paid £110 approx as a payment gratitude>