MPPI, is it worth claiming?

DavidJonas

My wife has MPPI (incapacity) from Legal & General, which she was advised was compulsory when she took it out in 2003. She actually had a more expensive unemployment MPPI which they made her take out as well, but we cancelled that some time ago.

In her current job, she doesn't need the incapacity insurance at all - she has permanent health insurance that will cover the mortgage in that event - and she has been doing that for 3 years - but that is our look out. We should have realised! Well, we realise now so we are cancelling it today.

However, I think she may have had permanent health insurance in the old job too, and we are going to check it.

My question is.. if she did have PHI in 2003 - that would have covered the mortgage in the event of long term incapacity - would that be grounds for a claim?

If not, I don't suppose we'll be able to prove she was bullied into taking it out by the broker, and so we may as well leave it.

I know how she feels. I had loan PPI in 2001 and was told that was compulsory. Haven't claimed that, but it's too long ago now. Paid it off pretty quickly anyway.

dunstonh

My wife has MPPI (incapacity) from Legal & General, which she was advised was compulsory when she took it out in 2003. She actually had a more expensive unemployment MPPI which they made her take out as well, but we cancelled that some time ago.

Are you sure it is MPPI? It sounds more like an income protection plan/PHI. You wouldn't have two MPPIs

In her current job, she doesn't need the incapacity insurance at all - she has permanent health insurance that will cover the mortgage in that event - and she has been doing that for 3 years - but that is our look out. We should have realised! Well, we realise now so we are cancelling it today.

Company PHI is great. No underwriting issues as they cover all staff normally. However, as you say, this only became available 3 years ago. So, no impact on the sale of the original plan.

However, I think she may have had permanent health insurance in the old job too, and we are going to check it.

It is rare to come across group PHI in any job. To have it in two consecutive jobs is more so.

My question is.. if she did have PHI in 2003 - that would have covered the mortgage in
the event of long term incapacity - would that be grounds for a claim?

You mean complain. Not claim. There is the potential for a valid complaint if she did have a group PHI in 2003. However, it would depend on where she bought it for starters. Insurance regulation started in Jan 2005. If she bought via a bank or via an L&G rep then they would have to consider the complaint. If she bought via a mortgage broker or IFA, then they do not.

Also, it depends on what info was supplied. Employer benefits are a normal question on the factfind. If it is recorded that your wife said there was none or it was just SSP, then the advice would be suitable on the information supplied. Even if the info was wrong.

If not, I don't suppose we'll be able to prove she was bullied into taking it out by the broker, and so we may as well leave it.

It would not be a credible complaint to make after 14 years. People who make the bullied allegation tend to be credible when the complaint comes in days, weeks or a year of the sale. Even where there is no evidence to support the allegation. Each year that passes, that credibility is lost. After 14 years, there is no credibility and there wont be any evidence.

DavidJonas

dunstonh wrote: »

Are you sure it is MPPI? It sounds more like an income protection plan/PHI. You wouldn't have two MPPIs

I have the paperwork and it says Mortgage Payment Insurance at the top.

The other one kicked in right away after unemployment as I recall. She was told she needed both to get the mortgage.

dunstonh wrote: »

Company PHI is great. No underwriting issues as they cover all staff normally. However, as you say, this only became available 3 years ago. So, no impact on the sale of the original plan.

It is rare to come across group PHI in any job. To have it in two consecutive jobs is more so.

We still have to check that out, but it is essentially the same job, same industry, different employer. It may be she had it (or not!).

dunstonh wrote: »

You mean complain. Not claim. There is the potential for a valid complaint if she did have a group PHI in 2003. However, it would depend on where she bought it for starters. Insurance regulation started in Jan 2005. If she bought via a bank or via an L&G rep then they would have to consider the complaint. If she bought via a mortgage broker or IFA, then they do not.

She bought it in the Woolwich. I suppose they got commission from the policies (?).

dunstonh wrote: »

Also, it depends on what info was supplied. Employer benefits are a normal question on the factfind. If it is recorded that your wife said there was none or it was just SSP, then the advice would be suitable on the information supplied. Even if the info was wrong.

Difficult to say after all this time!

Considering my own experience, in which I was sold PPI on a loan I didn't want as a young adult who only went in to discuss his overdraft - despite being self employed and clearly ineligible - I wouldn't be surprised at anything going on back then.

dunstonh

I have the paperwork and it says Mortgage Payment Insurance at the top.

A term used by several product types. Including life assurance and Life assurance plus critical illness cover.

The other one kicked in right away after unemployment as I recall. She was told she needed both to get the mortgage.

To have best coverage, an MPPI for the first 12 months and a PHI kicking in after 12 months is usually best (noting employer sick pay can vary that)

She bought it in the Woolwich. I suppose they got commission from the policies (?).

The staff member didnt but Woolwich would.

despite being self employed and clearly ineligible

Actually, most PPI does cover the self employed. It is a significant minority that does not.