Can she increase her premium?

Kaybenson

A Pal have a life insurance with a company 10 years ago. 3 years ago, she was diagnosed with cancer of which she has gone through treatment. She is now OK. Can she increase her premium? Does she HAVE to notify the insurance company? Thanks

MovingForwards

I imagine her t&C's would have said she needed to notify them three years ago.

Why does she want to increase her premium or do you mean will they?

Kaybenson

MovingForwards wrote: »

I imagine her t&C's would have said she needed to notify them three years ago.

Why does she want to increase her premium or do you mean will they?

I will ask her to check her T&C.

'' Will they? ''

Weighty1

The insurance company won't increase her premium because she has had cancer, nor would your friend need to notify them of this.

Conversely, she won't be able to increase her level of cover (if this is what you mean?) just because she wants to. Some policies include "guaranteed insurability options" which neable policyholders to increase their cover levels based on certain life events, such as marriage, the birth of a child, an increase in mortgage, however, this normally has to be done within a fairly short period of time following the life event occurring.

Aretnap

MovingForwards wrote: »

I imagine her t&C's would have said she needed to notify them three years ago.

Almost certainly the t&C's will not have said this.

Life insurance is a pretty simple product. You answer some questions about your health at the time you buy the policy. The insurer estimates the risk of you dying during the length of the policy - which includes the risk of your health deteriorating gradually as well as the risk of you being suddenly such down by a heart attack or bolt of lightning - and bases the premium on that estimate. If you die during the lifetime of policy it pays out. If you're still alive at the end of the policy, it doesn't pay out. If they're not sure whether you're alive or dead, they prod you and see if you move. 😉That's about it. There is no requirement to inform the insurer of changes to your health which occur during the policy, and if you do inform then they cannot change the premium because of those changes.

It could not actually work any other way. If the insurer could cancel your life insurance policy, or raise the premium to unaffordable levels, as soon as it looked as if you might be about to pop your clogs, what would be the point of having it? At best it would effectively only cover sudden death - and the large majority of premature deaths are not particularly sudden. So provided you answered the questions about your health accurately at the time you took the policy out there is no further duty to notify the insurer of any changes which happen once the policy is in force.

Old_Lifer

Only Weighty has answered both questions. The OP is also asking if premiums (and by implication cover) can be increased and indeed this is the question in the thread title.


In the absence of any options as outlined by Weighty, the policyholder would have to apply for a further policy and the new policy would require disclosure of the current medical position. The policyholder would be 10 years older so even without any medical conditions the premium would be higher.



However, it would perhaps be advisable for the 'Pal' to go to an independent adviser who could scource the whole of the market and could take soundings to find a Life Office sympathetic to the friend's condition.

Kaybenson

Many thanks old lifer and Weighty. Very very insightful.