Life Insurance Expiration - Unclear policy wording.

Hydra_2

Hi everyone,

My mum had a shock when she tried to amend her life insuarnce recently - she was told the insurance expires at age 70. When she bought the policy in 2004, she really thought it was a whole life policy. I have checked the wording on the policy document and to me, it doesn't seem at all clear. Could people tell me what they think? The relevant clause is below:

"WHEN YOUR INSURANCE ENDS

Unless renewed in accordance with the renewal conditions above, your Life Protection Plan will end on the earliest of the following dates:

- The monthly renewal date following your or your covered Partner's 70th birthday.
- the effective date of cancellation
- the date of your death."

The 'renewal conditions above' read thus:

RENEWAL CONDITIONS

You may renew your life protection plan each month by paying the amount of premiums set out in the schedule of benefits (or at the rate in effect at the time of renewal following prior notification by us) by the due date. If you do not pay the premiums by the due date or within the grace period, your life protection plan will terminate as of the day before the due date."

This translated to my mum as 'keep paying your premiums and you stay covered'. However, when she was 69 she contacted the insurance company as she wanted to increase her premiums for a better level of cover, this was when she was told the policy was due to end - she was also told she could not renew it or extend it. She is now covered with someone else - but feels she was mis-sold this policy - certainly the wording isn't at all clear to me - does she have a case? Many thanks in advance.

dunstonh

It appears she has bought a monthly renewable term assurance rather than a whole of life policy. These are not open ended but cease on a given age (of which 70 is quite common).

This translated to my mum as 'keep paying your premiums and you stay covered'.

I don't read it that way as it clearly gives three examples of when the cover will end.

but feels she was mis-sold this policy

Who sold it to her? Was it an advised sale or did she buy it directly or via a comparison site?

sheramber

This translated to my mum as 'keep paying your premiums and you stay covered'.

No, it says keep paying your premiums and you stay covered until the earliest of the following dates

- The monthly renewal date following your or your covered Partner's 70th birthday.
- the effective date of cancellation
- the date of your death."

pinkteapot

Actually, I can see where OP is coming from.

It says "Unless renewed, your protection will end on:" That implies that the insurance will end on the 70th birthday, but not if you renew it.

Although it then doesn't really make sense because the bit about the 70th birthday would become irrelevant.

I do agree the wording could be better.

They should have just put:

Your Life Protection Plan will end on the earliest of the following dates:

- the monthly renewal date following your or your covered Partner's 70th birthday.
- the effective date of cancellation
- the date of your death

provided that you keep renewing your policy.


Then some blurb about how if you stop paying the policy will also stop.

EnglishMohican

I agree with Pinkteapot. The wording says quite clearly that the three clauses apply unless you keep renewing monthly.

However, I doubt that that is what was meant. The wording is very poor and an insurance company that writes such bad English deserves to go out of business as far as I am concerned.

I guess there must be an ombudsman who might be unimpressed enough by that wording to order some compensation. I expect it would depend what else the policy has to say elsewhere.

kingstreet

I wonder if there were any other renewal conditions not C&Ped by the OP?

dunstonh

I guess there must be an ombudsman who might be unimpressed enough by that wording to order some compensation.

The ombudsman is not there to award compensation like that.

Thrugelmir

pinkteapot wrote: »

It says "Unless renewed, your protection will end on:" That implies that the insurance will end on the 70th birthday, but not if you renew it.

It doesn't say that.

The sentence is broken by the comma.

Unless renewed in accordance with the renewal conditions above,

Quite clearly this refers to the renewal conditions.

your Life Protection Plan will end on the earliest of the following dates:

Again clearly states the dates upon which the policy cover will cease.

EnglishMohican

You cannot ignore the "Unless". It ties the second half of the construction to the first part.

"Unless A, then B" is a perfectly logical construction. It means that if A happens, B will not. If A does not happen then B will.

In this case, the A is the "renewed in accordance with the conditions above" and the B is the three clauses about the end of the insurance. The comma simply separates the two options only one of which can happen.

@DunstonH. What is the ombudsman there for then and if not for this then what who does ensure the insurance industry behaves itself?

dunstonh

@DunstonH. What is the ombudsman there for then and if not for this then what who does ensure the insurance industry behaves itself?

It is there as an independent arbiter of complaints. Financial redress is payable if it deems there to be a loss due to a failure. It does not issue compensation for what is described on this thread.

The ombudsman does not ensure the insurance industry behaves itself. That is the role of the FCA.

pinkteapot

Hmmmm. Most insurers have their policy wordings available online, but a Google search for the phrasing in OP's post only returns this thread. I'd expect the policy booklet to turn up. OP - have you quoted word for word, and which company is it?