Critical illness insurance claim declined

chrisarvor

Hi
i took out a critical illness cover with Lloyds bank as advised to on my mortgage back in 1997,, i had MS and was told to get a medical done by our doctor which i did
They accepted the policy At the time i had split from my husband but after 3 years we got back together
My MS got worse and i was going to have to retire from my nursing career
My husband went through my documents and found the critical illness policy which we claimed on
Lioyds bank declined the claim but refunded my payments without me asking them to
My husband contacted them but they said there was no claim to be made so he contacted the ombudsman who supported them ????
At the time we had all the documents and the doctors letter for the medical,
The policy was for 50,000 pounds for the mortgage when we had a meeting at the bank which sold me the endowment mortgage we were then told that the mortgage had no endowment policy in place to pay off the mortgage !!!!!!!!!!!! it was a complete sham of them

After all this time is there anything i can do ????? we feel so angry but at the time i was so ill i told my husband to leave it as stress is bad for my MS

Any advice please

dunstonh

After all this time is there anything i can do ?

No.

we feel so angry but at the time i was so ill i told my husband to leave it as stress is bad for my MS

They refunded the premiums. You got your money back. This will either be due to accidental non-disclosure (which results in the premiums being returned) or a decision made on your complaint that the exclusions on the policy were too many for it to be realistic for you to have. Your MS would never have been covered. It would have been excluded from the start.

Bonfire_Bride

Unfortunately, MS is never included as critical illness. I can understand it is an incredibly difficult illness to live with but you would never find it included as CI. Even if they did cover MS - you were aware of the condition prior to the insurance starting. It would be classed as a pre-existing condition and would not be covered.


If your premiums were refunded, then the bank has put you back into the position you would be in, if you had never taken out the insurance.


Did you not query where your endowment premium was being paid from? or how it was being paid?? When does the mortgage end?

chrisarvor

thanks for the reply
they already accepted her on the policy after a medical so they new about the MS ????
as i said in the post we were not together at the time and it was my husband who discovered thee were no endowment payments

"If your premiums were refunded, then the bank has put you back into the position you would be in, if you had never taken out the insurance. " is that classed as not paying out that not paying out????

the whole package was a disgrace , we sold the house some time ago but it annoys me to think they can get away with these things

dunstonh

they already accepted her on the policy after a medical so they new about the MS ????

Yes they did but it didnt mean MS was one of the specified illnesses covered or that they offered cover for MS. Either the plan didnt offer it to begin with or if it did, they would have exempted it as it was a pre-existing condition. You do not get cover for a condition you already have.

"If your premiums were refunded, then the bank has put you back into the position you would be in, if you had never taken out the insurance. " is that classed as not paying out that not paying out????

They decided at the complaint to refund the premiums. This could be because of non-disclosure on something by you or it could be that they decided that, following your complaint, they felt that the policy is unlikely to be suitable for you given your condition and that any illness that could be attributed to MS would be excluded. Or it could be that it was just cheaper for them to refund the premiums as the easiest course of action.

the whole package was a disgrace , we sold the house some time ago but it annoys me to think they can get away with these things

I am struggling to see what they have got away with.

JimmyTheWig

dunstonh wrote: »

I am struggling to see what they have got away with.

Lets assume that the next person into the bank after the OP was in the same position. They, too, got sold a policy that wasn't appropriate.
Lets assume that this next person never felt the need to claim on the policy and so never found out it was mis-sold.

That means the bank have taken money for a policy without having any liability for it.

antrobus

JimmyTheWig wrote: »

Lets assume that the next person into the bank after the OP was in the same position. They, too, got sold a policy that wasn't appropriate.
Lets assume that this next person never felt the need to claim on the policy and so never found out it was mis-sold.

That means the bank have taken money for a policy without having any liability for it.

I think you misunderstand.

The OP had MS and purchased a critical illness policy. The insurer would have paid out had the OP suffered a critical illness. However even if MS was specified as a critical illness in the policy, it would not have paid out in respect of that illness, because the OP already had it when they took the cover out.

Insurance covers you against things that might happen. But not things that have already happened. Which is why the ombudsman would have rejected the complaint.

JimmyTheWig

antrobus wrote: »

Which is why the ombudsman would have rejected the complaint.

Are you saying you think the bank returned the OP's premiums when they didn't need to have done?

dunstonh

JimmyTheWig wrote: »

Are you saying you think the bank returned the OP's premiums when they didn't need to have done?

That is a possible outcome, yes.

A lot of the banks/building societies will have a like a floor limit where they will auto-payout upto that amount in cases like this. I know one bank that was £3000 for a period. i.e. if the redress on the complaint was under £3000 then they would pay out whether there was a case or not.

It is a measure of whether it is cheaper to pay out or fight the case. It will be on a range of variables. In a quite period of complaints in a business area with a good audit trail that clearly shows no wrongdoing, they will not use the auto payout. In areas where getting data is expensive (as its been sent off to some central storage site where no electronic record exists and requires the actual papers for example) and its an area where they own complaint uphold rate is above a certain amount, then they make that judgement call.

Complaint handling is not all black and white. There are decisions that get auto paid out. I have seen bank complaint outcomes that should never have been upheld and yet others that are nailed on complaints get rejected and had to go to the FOS. They are really strange in their outcomes at times. They have the accuracy of a scud missile.