Life Insurance

walesbug

I have recently been diagnosed with incurable cancer of unknown primary which unfortunately has spread. I got in touch with LV who I had life insurance with. After speaking to them I arranged for my consultant to send them my diagnosis of 4th stage cancer with 12 months left to live.
LV eventually got back to me to say they were refusing my claim as the policy had less than 12 months left before it ended ! So basically they wouldn't pay out.
They sent me a copy of the policy and buried in the small print were the facts that the policy would not pay out during the first 12 months or the last 12 months !
So there we are a warning MAKE SURE YOU READ THE SMALL PRINT - it cost me nearly £25000 !!!

tacpot12

That is very sad, and mystifying (I could understand the term if it applied to death by suicide. If sorry that you have had this diagnosis.

It's not clear whether LV are only refusing to pay out prior to your death because of this clause (and will pay the sum assured after you have died), or whether they will not pay it at all. 

If you feel strongly that you were mislead, you could challenge the exclusion as an unfair contract term. If you have legal expenses cover as part of your home insurance, you might find that you have legal expenses cover, and if you do, you will have a helpline you can call for professional legal advice. I would call them if you can, and see if they can advise you on whether you might have a case for getting that term thrown out as being an unfair contract term. 

You could also make a complaint to LV and then to the Insurance Ombudsman, but as time is short I think I would try everything in case anything works. What you do will depend to some degree on the importance of this particular sum of money to you or your family.

Thank you for taking the time to post at this awful time. I sure it will help others. 

Old_Lifer

Presumably they are only refusing to pay-out  early and will still pay-out on death ,  as   tacpot12  suggests in  his post.

The clause was not around in my day but I can see the the reasoning behind it.   If a policyholder has a policy which expires in 6 months time and has been given a life expectancy of 12 months,  he may still be alive  after the policy expires so they will not pay-out early  but they would pay-out as normal on death before the policy expires.

walesbug

Thank you for your help and replies The policy ends in March 2021 and it's quite ironic that if I were to die before then LV would pay out.  I will get in touch with LV again and explain my situation but in the meantime please everyone READ THE SMALL PRINT !!!!!

Aretnap

Very sorry to hear about your situation. 

Unfortunately this is a fairly standard feature of life insurance policies, and not something which is specific to LV.

A standard term policy will pay out if you die before the end date, but not if you die after the end date. 

The terminal illness feature which comes with some policies is basically just a tweak to this. It means the policy will pay out before you die, rather than after you die, provided you have only a short time to live (usually less than 12 months) AND it is certain (or almost certain) that you will die before the end date.

So it's normal for the terminal illness part not to apply if you get a terminal diagnosis in the last year of the policy - because the "certain to die before the end date" part is no longer true. It will if course still pay out if you do die before the end date. 

dunstonh

LV eventually got back to me to say they were refusing my claim as the policy had less than 12 months left before it ended ! So basically they wouldn't pay out.

That is very sad but it is normal on most life policies.  Some are longer than 12 months.

That is very sad, and mystifying (I could understand the term if it applied to death by suicide. If sorry that you have had this diagnosis.

Suicide is often 12 months but in this case, I believe its referring to the terminal illness coverage and not the life assurance element itself.

The clause was not around in my day but I can see the the reasoning behind it. 

It was around in 1994 when I started but you go back further than I do    Terminal illness cover used to be a cost add on.  Now its pretty much included on all plans as standard.

So there we are a warning MAKE SURE YOU READ THE SMALL PRINT 

It's not normally just in the small print but in the key features document but also in the shorter, larger text key features document.   However, in reality, most people would ignore it because it is a statistically small likely outcome.  Fundamentally, the most common reason for people to take out life assurance is if they die between the start date and the end date.

The reason they reduce it for terminal illness benefit is you could be diagnosed with 12 months to live but have only a couple of months remaining on the policy.  So, chances are you would live beyond the policy term.