Too much life insurance on Endowment - can I reclaim after 20 years?

Mike_Armstrong

I think I may have dropped a colossal clanger.

I have 3 endowment policies with L&G :-

Policy 1 set up in May 1993 - Target £19k, has just paid out £14k. Life Insurance of £19k. Monthly payment of £27.08, total paid in £8,124.

Policy 2 set up in April 1995 - Target £31,750, predicted to pay out approx £22k in 2020. Life Insurance of £31,750. Monthly payment of £49.08, total paid to date £13,644.

Policy 3 set up on September 1998 - Target £5,800, predicted to pay out approx £5,300 in 2020. Life Insurance of £37,500. Monthly payment of £31.48, total paid to date £7,492.

Policy 3 looks wrong to me. I think the life insurance should only be £5,800. It seems to have been set at the total value of both policy 2 and policy 3. This must have been an error when the policy was created. I accept that it has taken me 20 years to notice this but, assuming it is in error, am I likely to have any recourse?

I have raised a complaint with L&G and am waiting to hear back from them. The mortgage was arranged with Northern Rock.

Thanks for any advice!

dimbo61

Unless you have kept all the paperwork from when you set up the policies and have proof you only wanted and needed the smaller amount of life cover you will find it hard to get any kind of compensation.
So in 1998 did you buy a property for £50,000 or £88,000?
If the life assurance had paid out to your family would they be making a complaint !
I pay life assurance every month and cleared my mortgage off 3 years ago

Mike_Armstrong

Thanks for the reply :-)

The property we bought in 1998 was around £61k - definitely not £88. We had endowments worth £56,500 to cover the mortgage, which is about right for purchase price of £61k less deposit.

We had a clear-out of old paperwork a few years ago and I think the paperwork for that move went in the shredder. I still have documentation of the next house move in 2001, but hot this one from 1998 :-(

Would L&G not also have copies of the paperwork? Or maybe our solicitor?

Could it maybe be argued that the amount of the incorrect insurance at £37,500 being exactly the total of £31,700 + £5,800 that it is clearly a mistake? Surely 99% of endowment mortgage holders would only take out life cover for the amount owing on a mortgage - we had no other debt.

Thanks for the reply - I'm grateful!

sal_III

I doubt you have any recourse after 20 years.

Look at it from the other angle - What would have happened in the event of your death - the policy would have paid the £37500 as per the signed document.

I think that the most you could hope to achieve here, is to reduce your future monthly payments by reducing the life cover in the future, if at all possible.