Cancelling life insurance

Legacy_user

If you want to cancel a life insurance policy, do you need to inform the insurer in writing, or can you simply cancel the direct debit with your bank? I just wanted to check there aren't any penalties for doing the latter? The company in question is Zurich, but assume the principle would apply to all/most?

Caz3121

cancelling a direct debit does not end a contract, it just means that you start accruing arrears and it could get passed to debt collectors.
Cancel with Zurich

Quentin

Doing both is best.


If you just cancel the dd you will get numerous letters asking you to reinstate it till eventually they stop.


(If you set this up via a broker/ifa they may be entitled to an early termination payment in respect of their lost commission - this will be set out in any contract you agreed to when using their "service")

Quentin

Caz3121 wrote: »

cancelling a direct debit does not end a contract, it just means that you start accruing arrears and it could get passed to debt collectors.
Cancel with Zurich

This is just scaremongering.


Debt collectors won't get involved over a cancelled dd for a life insurance policy.

System

Thanks will do.

System

Quentin wrote: »

This is just scaremongering.


Debt collectors won't get involved over a cancelled dd for a life insurance policy.

That was my thinking, I thought the policy would just end. I'll write a letter in any case, but will cancel the d debit too.

hcb42

You need to end the contract, which isn't the DD! That's not scaremongering, that is good advice.

Quentin

hcb42 wrote: »

You need to end the contract, which isn't the DD! That's not scaremongering, that is good advice.

The scaremongering was that they set debt collectors on you if you stop paying premiums for a life insurance policy.


All that would happen is the insurer would give you the chance to "catch up" on your missed premiums, but then just give up and end the policy.

dunstonh

Whilst most life assurance companies will not chase for non payment and allow the lapsing of the policy due to non-payment, that does not tend to happen with all insurance policies. In particular household or car insurance.

It is best to notify the provider of cancellation and cancel the direct debit.

Quentin

dunstonh wrote: »

most life assurance companies will not chase for non payment .....

More scaremongering. You don't get debt collectors on you for stopping life insurance payments.

Unless of course you can tell us the companies that will?