Aviva Lifetime Benefit Plan rip off

muffyc30

I have been paying into an Aviva Lifetime Benefit plan for many years.
It had a benefit amount of £77k for death benefit or critical illness for a monthly payment of £32.33.
I recently got a letter from them saying they would no longer support this payment and that it would drop to £30K for the above unless I upped my payments to £85.29 per month.
This seems very unfair as they entered into this agreement with me some time ago.
Surely they should honour it?
It seems that Insurance companies like Aviva can do whatever they want to customers without giving a dam about them.
:mad:

[Deleted User]

muffyc30 wrote: »

I have been paying into an Aviva Lifetime Benefit plan for many years.
It had a benefit amount of £77k for death benefit or critical illness for a monthly payment of £32.33.
I recently got a letter from them saying they would no longer support this payment and that it would drop to £30K for the above unless I upped my payments to £85.29 per month.
This seems very unfair as they entered into this agreement with me some time ago.
Surely they should honour it?
It seems that Insurance companies like Aviva can do whatever they want to customers without giving a dam about them.
:mad:

Hi muffyc30,

In this situation I'd like to refer to the experts in the relevant team to check your Lifetime Benefit plan. If you're happy for me to do this, can you please email me at social@aviva.co.uk with the following details:

• Your full name
• Date of birth
• Postcode
• Plan or policy reference number
• MSE username so I can tie this post to your email

I look forward to hearing from you.

Many thanks,

Marv
Aviva Social Media Support

kingstreet

If the plan has built-in reviews and the premium and sum assured are only guaranteed between those reviews, there was always the possibility this could happen.

Products with a fixed premium and sum assured would have avoided this, but would have been more expensive at the outset.

dunstonh

This seems very unfair as they entered into this agreement with me some time ago.

The agreements on these plans is that there is an initial guarantee period (typically 10-15 years) and then they go on to reviewable premiums on an ongoing basis (typically reviewed every 5 years).

Surely they should honour it?

They are.

t seems that Insurance companies like Aviva can do whatever they want to customers without giving a dam about them.

No. They are doing what the contract allows them to to. it is one of the risks with reviewable premiums. Guaranteed premiums would have prevented this but guaranteed premium plans used to be a lot more expensive than reviewable. f you are within the guarantee period, you have actually been getting the cover cheaper than you should have. So, its the insurer that has lost out, not you. However, that was the contract agreed and they are honouring it.

Plus, plans with an investment element have suffered due to investment returns being lower than historical average during the dot.com crash and global recession. So, if the investment element was there to provide for the extra costs of life and CI cover at a later age and has not made enough to cover that then you are given the choice to increase premiums or reduce cover.

All of this is set out in the contract you agreed. These types of plans are largely obsolete in comparison to modern plans with todays pricing. However, they were the norm 20 years ago. If you are still in good health, it may be worth looking at modern plans.