My Dad cancelled his life insurance just before he passed away...

M84

Hi all,

I know I'm probably clutching at straws here but my Dad cancelled his life insurance over the phone in August. He sadly passed away in December.

I find it strange that he cancelled his policy as he wasn't in the greatest health. However, he did pay off his mortgage in August and I think this must have been the reason why he cancelled the policy.

I have contacted the life insurance company and they have said that they're not paying out. They did state that the trustees did not sign the cancellation form, is this a technicality we can exploit?

I'm not hopeful, however it would be nice to hear from somebody who has also experienced something similar to this.

Thanks in advance.

PersianCatLady

Are you saying that your father paid off his mortgage in August and therefore no longer needed life insurance so he cancelled the cover


OR


That your father cancelled his life insurance and used any money that was refunded to him to pay off the mortgage?

Quentin

Obviously (sorry) the policy ends on a cancellation and if it was a policy that only paid out on the death of the policyholder then there cannot be a payout when the death of the ex policyholder eventually happens

It looks like he maybe wanted more disposable income when he no longer had to pay his mortgage and had the previous mortgage payment and the insurance premiums to then spend??

PersianCatLady

Quentin wrote: »

Obviously (sorry) the policy ends on a cancellation and if it was a policy that only paid out on the death of the policyholder then there cannot be a payout when the death of the ex policyholder eventually happens

It looks like he maybe wanted more disposable income when he no longer had to pay his mortgage and had the previous mortgage payment and the insurance premiums to then spend??

Do you think that the OP's father could have "cashed-in" his life insurance policy and received some money which is why he paid the mortgage off in August??


That was one of the two ways in which I read the OP.

takman

PersianCatLady wrote: »

Do you think that the OP's father could have "cashed-in" his life insurance policy and received some money which is why he paid the mortgage off in August??


That was one of the two ways in which I read the OP.

The OP doesn't say that at all!. It says he cancelled the life insurance because he had paid off his mortgage.

Plus how many policy's do you know of that would pay out when they are cancelled.

TadleyBaggie

takman wrote: »

T
Plus how many policy's do you know of that would pay out when they are cancelled.

We just cancelled a old Barclays policy and got about £13K.

rs65

PersianCatLady wrote: »

Do you think that the OP's father could have "cashed-in" his life insurance policy and received some money which is why he paid the mortgage off in August??


That was one of the two ways in which I read the OP.

If that was the case, I suspect the insurer would have said so - rather than say they're not paying out.

POPPYOSCAR

No you do not have a case.

No premiums have been paid since august, policy would have been cancelled anyway.

takman

TadleyBaggie wrote: »

We just cancelled a old Barclays policy and got about £13K.

I dont really see what the benefit of that type of policy is. Why would you not choose to have a lower premium and invest the rest of the money yourself so you have control over it. You then also don't need to cancel the policy if you wanted the cash payment.

Aretnap

takman wrote: »

I dont really see what the benefit of that type of policy is. Why would you not choose to have a lower premium and invest the rest of the money yourself so you have control over it. You then also don't need to cancel the policy if you wanted the cash payment.

They were common in days of yore. Not everybody wants to manage their own investments, and your options for doing so we're more limited in the days when buying shares involved scouring the fine print of the Financial Times to look up prices and phoning your broker (whom you paid a hefty fee) rather than buying funds through an online platform.

Nowadays such policies are rarer - they've been made largely obsolete by other investment options and lack the tax advantages of ISAs. But some people are unhappy with the idea of paying into a policy for years and getting nothing back (which is a bit silly as that's how every other sort of insurance works too, but there you go) so there's still some market for them, and there are also a lot of old policies still active from the days when they were popular.

M84

Thanks for your replies, I really appreciated them.

He cashed in one of his pensions and paid off his mortgage in August, so it seems he just wanted more disposable at the time. He obviously didn't know he was going to pass away 4 months later.