Contacted by Insurance broker to check my policy is on track

teenwolfhouse

I answered an unsolicited call from an insurance broker I used to take out life insurance back in 2017 under the guise that they wanted to check my policy is offering me the best value for money. The policy was to cover the mortgage, should myself or my Wife get seriously ill or die and the value is set to reduce over the term (in line with our repayment mortgage). Cynically, I am suspicious that they are looking for any changes in health since the policy was taken out so that they can increase the premium. Do I need to discuss this with them? Am I under any obligation to inform them of any changes in health? My understanding was that, we provide health information when the policy is taken out and that they would base the premium on the risk they calculate at that time - and that is good for the term of the insurance.
I asked the agent to call back at a more suitable time so I could check my documentation.... and seek advice - if anyone has any it would be appreciated.

Mark_d

I think you're right about not having to declare any changes to your health but I would re-read the policy documentation you have.

Personally I don't spend money on life insurance/mortgage protection insurance.  If I die then my spouse will inherit my pension, which would ensure our property is paid for.  If I get seriously ill then my employers would pay me something for a couple of years...and at some point I'd be able to draw on my pension early.

DullGreyGuy

teenwolfhouse said:

I answered an unsolicited call from an insurance broker I used to take out life insurance back in 2017 under the guise that they wanted to check my policy is offering me the best value for money. The policy was to cover the mortgage, should myself or my Wife get seriously ill or die and the value is set to reduce over the term (in line with our repayment mortgage). Cynically, I am suspicious that they are looking for any changes in health since the policy was taken out so that they can increase the premium. Do I need to discuss this with them? Am I under any obligation to inform them of any changes in health? My understanding was that, we provide health information when the policy is taken out and that they would base the premium on the risk they calculate at that time - and that is good for the term of the insurance.
I asked the agent to call back at a more suitable time so I could check my documentation.... and seek advice - if anyone has any it would be appreciated.

If they are a broker then they don't control the pricing.

Normal Life and Critical Illness is a form of long term insurance, as such you have no requirement to declare subsequent medical conditions and even if you do make voluntary declarations there is no impact on premiums. 

They won't be wanting to change the premiums on your old policy but it is ultimately a sales call. If for example you have been significantly overpaying your mortgage it may be possible for them to replace the existing policies with new policies at a lower premium but that is also dependent on what's happened to your health in that time too. 

They will also take the opportunity to double check your needs are fully covered... you've mentioned the mortgage which is ok but what happens if your wife were die tomorrow? If the mortgage is paid off can you continue the same standard of living based on just your salary or is a separate policy/section required to cover other living costs and the loss of their wages?

Similarly, Critical Illness only covers named conditions and many don't cover mental health so what is your plan if you have a breakdown and are signed off work for years? Can you afford the mortgage and living expenses on just your wife's salary? Do you have Income Protection Insurance?

Aretnap

teenwolfhouse said:

Cynically, I am suspicious that they are looking for any changes in health since the policy was taken out so that they can increase the premium.

You have nothing to worry about on that front. You're right that the premium is good for the duration of the policy.* You don't have to tell the insurer about any changes to your health - but even if you do your existing policy will be unaffected. You could tell him that you have stage 4 cancer and it would make not a jot of difference to your premium or your level of cover. It might make a bit it harder to take out a new policy, of course...

As above there are all sorts of reasons why you might need more or less cover than you did in 2017 - bigger/smaller mortgage, children, becoming accustomed to a higher standard of living and wanting to preserve it should one of you die etc etc. It is good to reconsider your needs from time to time. Whether you want to do that by having a conversation with the adviser you used last time or in some other way is up to you - it depends how happy you were with his service I guess.

* The exception would be if you have a reviewable policy - but even then the insurer can only make changes in response to changes in life expectancy generally or the insurance market as a whole - not in response to changes to your own health.