Reducing level of life insurance

susanthunt

Does anyone know if it is possible to reduce the cover on adaptable term life cover?

We took it out several years ago but at the time it needed to be high to cover mortgage on house and mortgage on our retail premises. We don't have the shop now and the premiums are pretty high.
I thought about cancelling and starting afresh but we are now almost 10 years older so I figure it would be pretty expensive for a new policy.

We have just had our annual statement which says if we are under insured we should ring to increase but doesn't mention any option to reduce cover.
Many thanks

kingstreet

You need to read the documentation for the plan, or ask the insurer concerned.

"Adaptable Term Life Cover" sounds like a brand name, not a generic term which would give anyone in here a clue as to the options you might have.

susanthunt

Thank you.
I will have to hunt for the paperwork. It was several years ago so probably means a trip up into the loft.
It is through Zurich and fairly sure it is the normal fixed term life cover where it runs for a period specified - 16 years in our case - then ends. No payout at the end.

kingstreet

If it's a level term assurance, that has a fixed monthly benefit for a fixed amount of time.

It may be possible to increase the cover without further evidence of health using a Guaranteed Insurability Option, perhaps on moving house, getting married, birth of a child etc.

Reducing the cover may not be possible and would require the cancellation of the contract and a new one to replace it. I'm sorry, it's not possible to say more without knowing more about the product.

weighty1_2

Adaptable term life plan sounds like a Zurich product. I've actually discussed this scenario previously with a client a couple of years ago and having spoken to the Zurich existing client team they confirmed that they would allow a client to reduce the level of cover they had.

All that was required was a letter stating how much you wanted to reduce the cover to and that the letter is signed by the policyholder/s.

Whether this is still the case I am not sure.