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Critical Illness Cover - Mis sold by bank?

Hello,
I am looking for some advice on whether I was missold critical illness cover:

In 2012 I applied for a new mortgage with my bank and also took out life assurance and critical illness at that time with the insurer connected/affiliated with the bank. During the process of applying for the cover, I discussed with the financial adviser at the bank a pre-existing / long standing medical condition and I was advised that it was not a significant matter. The application forms were completed by the financial adviser at the bank as part of the wider mortgage application and the insurer provided cover for both life and critical illness.

In 2015 I then looked to change our life assurance and critical illness cover with a new insurer. This application was handled by the same financial adviser (who was now working independently from the bank) and we discussed the same medical condition. This time the condition and minor symptoms were detailed on the application. The new insurer has subsequently declined the critical illness application and we are still awaiting decision on the life assurance.

On checking back to the application forms for the existing policies, the application in 2012 makes no reference at all to the medical condition, or any symptoms (minor as they are) associated with it. I appreciate there is an onus on myself to check the contents of the application, but the condition was discussed at the time and I was advised it was not relevant/important. It is only after disclosing the condition/symptoms on the new applications that it is clear there is a real issue with the particular condition and I feel the financial adviser when working at the bank should have been aware of this, and brought this clearly to my attention. To some extent it feels like the bank pushed through the insurance application by encouraging non-disclosure of the condition, when they should have been aware that the condition made it unlikely that I qualified for the cover.

We will contact our current insurer to understand what impact the condition has on the validity of the current policies - it seems unlikely that the critical illness cover will be valid. Hopefully the new insurer will award life assurance, and that will mean we can cancel the existing life assurance policy.

Should that play out, I will feel that I was mis-sold the critical illness cover by the bank. I appreciate I should/could have insisted for details of the condition to be disclosed, but this was discussed and it seems negligent on behalf of the financial adviser whilst working for the bank not to raise this as a concern/issue. I was therefore unaware of the significance of this until it was disclosed on the recent insurance application for which I was turned down. As the latest application demonstrates, there was never any intention or deliberate action taken not to disclose information. There was nothing to be gained in this situation of paying premiums for cover it seems likely was never valid.

If we do find out that the current critical illness cover is indeed invalid, I intend to contact the bank to claim that I was mis-sold the policy. Could anyone advise as to the chances of this claim being successful and being refunded the premiums paid to date?
Thanks

Comments

  • macca1974
    macca1974 Posts: 218 Forumite
    When you completed the application form, there would have been a variety of health questions that would have needed to be answered. These are usually yes / no questions and then if the answer is yes additional information is required.

    So are you saying that the adviser at the bank went through the questions with you and when one of them should have been answered yes, he suggested to you that you should answer no and the condition didn't need to be included? If so, that is pretty serious to be honest.

    What is equally serious was when you then signed the application form, there would have been a declaration that you signed which will have had some wording relating to all of the questions being answered truthfully and honestly.

    So effectively, you are currently guilty of "non-disclosure" which generally with a policy like critical illness will only be picked up in the event of a claim. You will claim, they will look into your medical records and they will then potentially not pay out the policy because the application form had not been completed truthfully.

    It sounds like the policy itself wasn't "Mis-sold" in the sense that it was something that you should have, its more that the adviser has encouraged you to complete the application inaccurately. I really don't know what the reaction of the bank would be if you complained, I suspect though they will have a copy of the application form, with a declaration on it and a signature stating that the information provided was truthful. You would then have to convince them (or perhaps later the ombudsman) that you had been encouraged to do this. Which might be a challenge.
  • dunstonh
    dunstonh Posts: 117,923 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Could anyone advise as to the chances of this claim being successful and being refunded the premiums paid to date?

    It doesnt sound like a mis-sold policy in terms of need and how it was sold. It is more a disagreement on what you did or did not disclose and whether the bank rep withheld information or not.

    It is impossible to guess the outcome on these. If the symptoms were minor then they would have no impact on the policy. However, you say that the same disclosure years later has led to a decline. Which would indicate they are not minor. Minor conditions do not prevent CI being applied for.

    Effectively, it is your word vs theirs and what the evidence available suggests may have happened. Hence why its impossible to call.

    BTW, Never ever buy your insurances via a bank. They are about 25-40% more expensive than via an IFA.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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