Mis sold life insurance

Divatrish

Less than 10 years ago, I took out a personal loan with Alliance & Leicester (Santander). I was advised to take a life insurance policy by the bank via Legal & General as I had 2 dependents. Policy was to pay £500 per month each for 10 years in the event of my death. I had no other life insurance. What they didn't tell me, was that it was time limited ( due to expire 2020), or that I would get any rebate if no claim made. It was £22 per month. My question is, was I mis sold, and can I claim this back. The loan was paid off years ago, and am fuming that I've been paying this, with nothing at the end. I rang L&G and they said it's down to the bank

[Deleted User]

It doesn't sound mis sold.

Life insurance pays out if you die. It's not a savings account, unless you want to pay substantially more for that facility.

Nasqueron

The policy was taken out to cover you during the loan period, it was not sold as a long term life insurance policy. The term length would have been explained to you at the time and you would have signed to agree you wanted it which the bank will be able to prove. If you wanted a lifetime policy or something with a rebate then you should have asked for that at the time or simply declined the policy

dunstonh

I was advised to take a life insurance policy by the bank via Legal & General as I had 2 dependents.

Sounds like good advice and justification for having it.

What they didn't tell me, was that it was time limited ( due to expire 2020), or that I would get any rebate if no claim made

Sorry. I don't believe any of that. The insurance quotes make it quite clear what the term of the insurance is and that you do not get anything back if you do not die. This would also be shown in the statement of demans and needs issued at the time.

You dont get insurance with rebates if you dont claim. So, it isnt something that would be talked about.

My question is, was I mis sold, and can I claim this back.

Nothing in what you have said suggests any missale.

The loan was paid off years ago, and am fuming that I've been paying this, with nothing at the end.

Do you fume that all the other insurances you pay do not give you something at the end?

Nearlyold

It doesn't actually sound as if the Life Insurance was particularly related to the loan - more that with dependants and no life cover there was a blindingly obvious gap in your financial planning. It sounds like a family income benefit plan where if you die during the term of the policy your dependants receive £1000 per month for the remaining term of the policy - it's a very cost effective way of providing much needed cover, so its difficult to see anyway in which it was mis sold.

Are you equally fuming that you don't get a rebate on your car/home contents/building/travel insurance.


The policy documents and the recommendation letter would have made it crystal clear it wasn't a savings plan and the term of the plan would have been equally clear. Policies that combine life cover and savings in one package have virtually disappeared from the mainstream market - its an expensive and inflexible way of combining two seperate needs which is why you no longer see them.


You can complain if you want but I would expect the chance of your complaint being upheld as anywhere between Nil and Zero by either the bank or FOS

SandraX

Dear OP
I'm with the insurance co.
Start looking for new cover the sooner you look the better
and move on.

[Deleted User]

Divatrish wrote: »

I was advised to take a life insurance policy by the bank via Legal & General as I had 2 dependents. Policy was to pay £500 per month each for 10 years in the event of my death. I had no other life insurance. What they didn't tell me, was that it was time limited ( due to expire 2020), or that I would get any rebate if no claim made.

Why would you get a rebate if you didn't claim? Can you think of any insurance that does pay such a rebate? Are you thinking of the No Claims Bonus on car insurance? That doesn't apply here.

You realise this is just cover in case you died while still owing money on your loan? That's why the policy expires in 2020 (when I expect your loan was originally due to be paid off). If you've long paid off the loan, then it's time to look for life insurance which is suited to your needs now. Expect to pay far more if you require more comprehensive cover, but do realise that it will be an insurance policy-not some kind of investment with a guaranteed return.

The policy in question was not mis-sold and it will/would be a waste of your time to make a "complaint" about it.

Sorry.

Divatrish

Thanks for the replies but..
1. I was NOT told it was time limited, and the loan term was 3 years, starting 2006, and was paid off within that time
2. I never received any policy documents, I only asked because the letter informing me that the term was due to expire arrived, and this was the first correspondence I received from them. (I should have chased up earlier)
I expected this was a life insurance policy for my life, and that's why I'm angry. I have no problem with insurance, but I asked a question because of the above

dunstonh

1. I was NOT told it was time limited, and the loan term was 3 years, starting 2006, and was paid off within that time

yes you were. It is impossible for the documentation to say otherwise. The quote issued at point of sale shows it. The quote resissued by the insurer after acceptance shows it. The statement of demands and needs shows it.

So, they have three places that they can show it was documented. What do you have to back up your allegation that it wasnt?

expected this was a life insurance policy for my life, and that's why I'm angry.

Now that would have been a missale.

You are getting angry over the correct policy sold but want the wrong type of policy that would have been a missale had it been sold to you.

Nearlyold

Divatrish wrote: »

Thanks for the replies but..
1. I was NOT told it was time limited, and the loan term was 3 years, starting 2006, and was paid off within that time
2. I never received any policy documents, I only asked because the letter informing me that the term was due to expire arrived, and this was the first correspondence I received from them. (I should have chased up earlier)
I expected this was a life insurance policy for my life, and that's why I'm angry. I have no problem with insurance, but I asked a question because of the above

So basically you wanted an inappropriate policy that would have been vastly more expensive - sounds like a dodgy insurance salesman's dream customer.

dunstonh

And for reference, here is a copy and paste of what an L&G policy said on their quotes from that era:

• The life cover will be payable should either of you die within the term of the policy.
• Your Monthly premium is guaranteed for the next 19 years. Your premium will only change if you increase your sum assured or change your plan in any way.
• WARNING - This contract has no cash-in value at any time.
• Your premiums pay for the cost of life cover, commission, expenses, charges and other adjustments.