Barclaycard Lifestyle Plan Cancelled by them last year?

The_Maestro

Hi,

I took out a Barclaycard 'LifestylePlan' in March 2011. This was to cover for unemployment/redundancy and would have covered me for £2000 per month if I had been made unemployed (which I wasn't) and also had 'life events' cover which would give me £250 back for each event such as the birth of a child.

I just phoned them today after the birth of my daughter to claim £250 and they told me that they had cancelled my policy last year! They said they sent a letter at the time which was returned to them. Actually at the time they sent the letter I was staying in Sweden for a few months on a work assignment so that is probably true.

Now, this was sold to me as if it was life insurance, and I was amazed that they could just cancel it like that - is that within their rights? They were also asking me about my Barclaycard credit card which I don't have and have never had on. It was sold to me as a type of life insurance nothing to do with a credit card. Reading up on the internet I have seen references to the Barclaycard Lifestyle plan as a type of PPI which I was totally unaware of.

Does anyone have any advice, I have just started thinking maybe they missold me PPI. I wasn't even aware it could be PPI related to a credit card until today. I'm just totally disappointed to find out I won't be getting my £250 for my new daughter and am not covered for unemployment any longer.

I really appreciate any advice. That money was going to buy a cot and some other things

David

dunstonh

Now, this was sold to me as if it was life insurance, and I was amazed that they could just cancel it like that - is that within their rights?

Life assurance would be monthly direct debit and not cancelled by the insurer as long as you made payments for the term. What you actually describe though it not life assurance. If it is a package of goods then they can withdraw it with notice in writing

Does anyone have any advice, I have just started thinking maybe they missold me PPI.

Nothing you have said suggests any mis-sale. So, why do you think it maybe?

I'm just totally disappointed to find out I won't be getting my £250 for my new daughter and am not covered for unemployment any longer.

Ignoring the fact you didnt update your address and didnt get the letter, did you not notice the payments no longer going out?

The_Maestro

dunstonh wrote: »

Life assurance would be monthly direct debit and not cancelled by the insurer as long as you made payments for the term. What you actually describe though it not life assurance. If it is a package of goods then they can withdraw it with notice in writing



Nothing you have said suggests any mis-sale. So, why do you think it maybe?



Ignoring the fact you didnt update your address and didnt get the letter, did you not notice the payments no longer going out?

Hi, I was paying monthly direct debit. I didn't notice when they cancelled it.

I was under the impression that it was life insurance because that is how it was sold to me. It seems it may be a type of Income Protection Insurance, however what confuses me is they said that it was linked to a credit card when I phoned them so I started thinking it may be some form of PPI, and its definitely linked to some sort of bank account because my policy document quotes an account number and sort code but I never asked for any such account.

Apart from that, I don't know the rules, I am just some pleb, but even if they didn't break any rules it just seems very unethical to me - so presumably they could just cancel it when your partner is 8 months pregnant and avoid paying for the 'life event' when I may have only been continuing paying the premium it in the expectation of getting that payout those 8 months. Or they could just pre-emptively cancel it if the country's economic outlook changes and they think that you are more likely to be made unemployed in the near future. Or they could target individuals in what they come to consider have professions likely to be subject to redundancies in the near future. So it sounds like they sold me a completely useless product. Sorry but I've also never heard of any insurance product that can just be withdrawn at any time, but maybe I am ignorant. Looking on their website it says the scheme is closed to new customers but that existing customers are still covered so I don't know why they cancelled mine. I will wait for the letter which they are resending to me.

dunstonh

but even if they didn't break any rules it just seems very unethical to me - so presumably they could just cancel it when your partner is 8 months pregnant and avoid paying for the 'life event' when I may have only been continuing paying the premium it in the expectation of getting that payout those 8 months.

They wrote to you and gave advance notice. How much more can they do?

Or they could just pre-emptively cancel it if the country's economic outlook changes and they think that you are more likely to be made unemployed in the near future.

For that type of policy, yes they can. However, that goes for many types. Not all (e.g. not life assurance with guaranteed premiums or income protection (PHI))

Sorry but I've also never heard of any insurance product that can just be withdrawn at any time, but maybe I am ignorant.

Most general insurance policies can.

The_Maestro

dunstonh wrote: »

They wrote to you and gave advance notice. How much more can they do?



For that type of policy, yes they can. However, that goes for many types. Not all (e.g. not life assurance with guaranteed premiums or income protection (PHI))



Most general insurance policies can.

So, if its not PPI or IPI what is it, just some 'general insurance' like you said? Feel free to close this or the other thread if you feel it a duplicate.

I don't know the 'legal' definition of 'Income Protection Insurance', but what I had was an insurance plan which was supposed to pay a percentage of my income in the event I was made unemployed, so my common-sense definition of that would be 'Income Protection Insurance'.

dunstonh

So, if its not PPI or IPI what is it, just some 'general insurance' like you said? Feel free to close this or the other thread if you feel it a duplicate.

It is a form of PPI known as accident, sickness and unemployment cover with a few misc bolt ons.

I don't know the 'legal' definition of 'Income Protection Insurance', but what I had was an insurance plan which was supposed to pay a percentage of my income in the event I was made unemployed, so my common-sense definition of that would be 'Income Protection Insurance'.

Historically, income protection was known as permanent health insurance. It has that name as it cannot be cancelled by the insurer unlike other types of insurance. PHI is the short name. It is long term insurance and fully underwritten at point of sale. It pays out in the event of inability to work due to sickness and will continue to pay until such time you can return to work or you reach the end age (typically retirement).

You have payment protection which is short term insurance, underwritten at point of claim effectively and will only pay our for a maximum of 12 months (some rare ones may go to 24 months). It is a product that does a job but its not a great product. I wouldnt have it and would prefer PHI over PPI virtually every time. However, banks tend to only have limited product ranges and their prices are rarely competitive and products quite poor value (in more recent years - there was a period when that wasnt the case).

Income protection does not cover unemployment. Payment protection does. There has been some muddying of the water with some payment protection companies trying to muscle in on the income protection market (especially with comparison sites) where they market payment protection as if it was income protection.