Life insurance - buy off a person

Lauraadele18

Hi

Can anyone tell me if you cam still buy life insurance policies as a third party - buy the policy off of the individual the policy is against? Is it legal to advertise to buy a policy off someone (obvioulsy the wording would have to be water tight)
Thanks
Laura

jonesMUFCforever

What kind of policy are you on about?

Endowment policies can be traded but not pure life policies as in most cases you won't have an insurable interest.

Lauraadele18

Life policies. People used to buy them yesrs ago take over the payments and then get the payout once the individual has deceased. Is this still legal to do anymore?

Weighty1

I suspect this is still legal as insurable interest only needs to be present at the time when a plan is set up and a person has an unlimited insurable interest in their own life.

However, in the past there used to be far more whole of life plans in force, rather than term assurance which is by far the most common plan now. With a term assurance plan the vast majority never pay out, hence the low premiums and it would be a big gamble for anyone to take over the ownership of one of these, unless the insured individual was already seriously ill, in which case the question is "why would they sell it?"

kingstreet

Weighty1 wrote: »

unless the insured individual was already seriously ill, in which case the question is "why would they sell it?"

Yep. Many term assurances also have terminal illness cover and the policyholder can claim 100% of the sum assured before they die.

dunstonh

Lauraadele18 wrote: »

Life policies. People used to buy them yesrs ago take over the payments and then get the payout once the individual has deceased. Is this still legal to do anymore?

How far in the past are you talking about?

Endowments stopped being sold by 2003 in the mainstream and the third party market only really existed between 1995 and 2010. Mainly as the old conventional with-profits plans had mostly ended by then and you only had unit linked or unitised with profit funds left. TEPs were not normally that good value either. It is a very very niche option.

BROKEN

Does anyone know why they companies who sell these policies can never give you a clear straight answer to your questions. All I wanted to know was the policy that i have - how has it been doing, what is the likely hood of it hitting the maturity amount and what was the payout figure for the same policy last year- no they couldn't. All i kept getting was I can tell you as the markets affect it, I know the markets affect it but can I make a clear decision of whether to keep contributing or cashing it in - No I Bloom in cannot.

dunstonh

All I wanted to know was the policy that i have - how has it been doing, what is the likely hood of it hitting the maturity amount and what was the payout figure for the same policy last year- no they couldn't.

A couple of reasons
1 - your questions require regulated advice permissions. Providers rarely have any staff that hold that permission
2 - the information on past policies is irrelevant as that has no link to what yours does. For example, last year may have had a 10% gain but a stockmarket crash could happen tomorrow.
3 - Plans had different target growth rates. So, a maturity on a low target growth rate plan would be higher than a high target growth plan.