Mis-sold Life insurance without a mortgage

icklesweetie

Can someone advise.. my parents have just told me that when they purchased their house in 2001/2 they then needed to take buildings insurance. (They bought it from LA and paid fully with no mortgage)
My Dad was told by Prudential that in order to take their buildings insurance he needed to take life insurance.

Never having bought this type of insurance before, my dad took out a policy for himself and my mum. They received a letter in 2010 saying the policy has now ended.
They have received nothing for paying into the policy for 8+ years

I am baffled as to what life insurance would cover when my dad was 44 at the time so only covering him until he was 52. They had no mortgage so could not have been to cover the mortgage repayments and what has life insurance got to do with buildings insurance?

Has anyone heard anything like this before? I have written to Prudential to ask for the policy documents and policy number as they wouldn't give my dad this detail over the phone.

Is this like some form of PPI?

Any guidance would be appreciated.

Thanks

roonaldo

Sorry but why shouldnt he had life insurance? One of the reasons its still taken is to protect the family in the event of his death, so he did have a need for it even without a mortgage, so its not mis-sold for that reason. You say he paid into it for 8 years and got nothing, but thats because he is alive. Insurance is to cover unforseen events. The only alternative was that he died and it paid a lump sum.

Also you say he took it out with buildings insurance (which he should have anyway) and was told to take it, but they are not linked and I would assume you have no evidence to show he was told he must take it. Buildings insurance is commonly available so why didnt he just go elsewhere or look on internet if he didnt want life insurance too?

Finally, life insurance is not PPI. Why is insurance a bad thing to have when in hindsight it hasnt paid out?

icklesweetie

I am not saying he didn't need life insurance, but usually life insurance is put in place to cover any debts such as a mortgage if anything were to happen to you. If it was not this type of policy I would assume it was put in place to pay out a lump sum should anything of happend. i am confused as to why he would be sold a policy like this which only lasted 8+ years. At 44 he would have had to die within 8 years to see any benefit of the policy- I know you cannot plan for the unexpected, but I would expect for this to at least cover you until old age.

My dad......... use the internet! HA thats funny, although we have just got him online this week.

We also are fully aware, thanks for pointing it out, that he would have needed buildings cover, having never had this type of cover before, my dad being naieve, took out the policy for life cover as he was advised that he needed it in order to get buildings cover.

This may not be PPI- hence the reason for asking for advice, just wondered if mis-selling of life insurance policys could at least get them their money paid into it back.

Thanks for your reply :-D

roonaldo

You are right that life insurance is usually bought to protect mortgage, but as he had a family there would still be a need for protection. The 8 years does seem odd. Perhaps Prudential may have record of why. Are you sure he didnt have debts? perhaps unsecured borrowing he has forgotten or not told you about, we are talking 12-13 years ago.

There will be no evidence that he was told he had to take it to get the buildings insurance.

MEM62

icklesweetie wrote: »

I am not saying he didn't need life insurance, but usually life insurance is put in place to cover any debts such as a mortgage if anything were to happen to you. If it was not this type of policy I would assume it was put in place to pay out a lump sum should anything of happend. i am confused as to why he would be sold a policy like this which only lasted 8+ years. At 44 he would have had to die within 8 years to see any benefit of the policy- I know you cannot plan for the unexpected, but I would expect for this to at least cover you until old age.


It would cover him for as long as he continued with it and paid the premium. As with any other kind of insurance.

My dad......... use the internet! HA thats funny, although we have just got him online this week.


Mine was the same :-)

We also are fully aware, thanks for pointing it out, that he would have needed buildings cover, having never had this type of cover before, my dad being naieve, took out the policy for life cover as he was advised that he needed it in order to get buildings cover.


I think there is a possibility he may be confused here. I am sure that the Prudential would have promoted the product but I cannot see them stating that it was a requirement of the contents insurance. If he has any documentation from the time to took the policies out I am sure that it would not support what your father is saying.

This may not be PPI- hence the reason for asking for advice, just wondered if mis-selling of life insurance policys could at least get them their money paid into it back.

Thanks for your reply :-D

I can't see a case for mis-sold insurance here.

dunstonh

I am not saying he didn't need life insurance, but usually life insurance is put in place to cover any debts such as a mortgage if anything were to happen to you.

That is one reason people do it. A more common reason is to cover for lost income in the event of early death or lost pension entitlement for the spouse.

i am confused as to why he would be sold a policy like this which only lasted 8+ years. At 44 he would have had to die within 8 years to see any benefit of the policy- I know you cannot plan for the unexpected, but I would expect for this to at least cover you until old age.

Maybe at that point, his pension entitlement was enough that it wasn't needed beyond that. Maybe it was for family protection and it was felt that you would have left home by then. You often see ages from 18-25 for the children used as the term.

This may not be PPI-

Its not. PPI is payment protection insurance. Life assurance is life assurance. Not a single bit of overlap and no similar issues.

It is possible to be mis-sold life assurance but complaints are low and the success rate at the FOS is low. Typically it is single people with no dependents that get their complaints upheld. Someone with a spouse and family is not going to get a complaint upheld unless they have too much life assurance (yet to see anyone over insured on life assurance)

icklesweetie

I'm glad I posted, thank you for your helpful comments. :-)