Aviva - income protection policy cancelled after policy change requested

papaface

Hi

I'm just wondering if I could please have an opinion on the following matter:

1. My mortgage advisor does income protection insurance via Aviva and applied for the policy on my behalf and I was emailed the policy information etc.
2. Income protection policy taken out with lets say £20k salary on 9th Jan 2024 . I also granted them permission to access my medical records if they wanted but they did not do this.
3. 17th Feb 2025 (over a year later) I requested a policy change as my salary went up due to a work promotion the previous June but I hadn't gotten around to revising the policy
4. I needed to fill in a 27 page questionnaire where one of the questions was: "Within the last four years have you had any of the following or required treatment for any of the following: 3a. Any mental health condition including anxiety, stress, depression, insomnia or an eating disorder?" - I answered "YES" because I had 1 week of work related stress in 2023 but did not get a fit note or get any medication for it and I've never been off work for anything except flu in the years prior and not been on any sick leave at all since this one instance in mid 2023
5. Aviva indicated they'd need to see my medical records to review the policy change so I approved this. It has taken mid-June for my GP surgery to actually send them to Aviva
6. 27th May - I get an acceptance offer from Aviva but on non-standard terms with a mental health exclusion and giving me until the 11th Sept to confirm by reply my acceptance. The quote states below the exlusion statement "We've adjusted your premium because of the exclusion". I thought the exclusion itself was grossly disproportionate for 1 week of timeout in 2023 so I wrote to them the same day asking for the decision to be reviewed and reconsidered but I did not indicate anywhere that I would not be proceeding with the offer
7. 4th June I get an acknowledgment that my email had been received
8. 5th June letter sent to me stating that my whole income protection plan which I took out in Jan-24 is now cancelled because they would have applied the exclusion back in Jan-24 if they had my medical records back then and because "I" (my financial advisor) did not answer "Yes" to the same question in point 4 back in Jan-24 they would have had applied the exemption back then.
9. Called them today when the letter was received and I've been told that apparently my financial advisor filled in the same questionnaire in Jan-24 and answered ""no" to the same question I answered in point #4 here - I have never seen this document nor is there any record of it in my emails - and have asked for a copy

That's the long & short of it.

My issue here is that even if we assume my financial advisor made an error when the original application was made in Jan-24, they reassessed the policy on the 27th May with the understanding of my answers in the policy change questionnaire and also put the exclusion in place on the acceptance offer. Therefore there can be no realistic expectation that they could not and should not have catered for this in the new premium, indeed there's a statement in the quote directly recognising that the premium has been lowered due to the exclusion.

I have confirmed with the advisor on the phone that the same person who handled my objection email is the same person who sent the letter. This seems retaliatory and vindictive on the face of it. I've recorded the telephone call.

I've been told that the advisor will review it tomorrow and get back to me.

It just all feels very slight of hand and they've latched on to what amounts of a very minor factor given that it was my intention to increase my cover and I did not tell them that I would not be proceeding with their new offer with the exceptions.

I appreciate that if I ever needed to claim on the policy they may have voided it but I think there are mitigating circumstances here.

DullGreyGuy

False declaration allows them to terminate the policy if they believe it was intentional or reckless. They can readjust the policy if they believe it was careless and they would have insured you had you made a truthful declaration. 

You need to be taking matters up with the person that sold you the policy and why there was the "error" on the form. 

dunstonh

My issue here is that even if we assume my financial advisor made an error when the original application was made in Jan-24, they reassessed the policy on the 27th May with the understanding of my answers in the policy change questionnaire and also put the exclusion in place on the acceptance offer. Therefore there can be no realistic expectation that they could not and should not have catered for this in the new premium, indeed there's a statement in the quote directly recognising that the premium has been lowered due to the exclusion.

At the point of sale in the original application, you should have been asked a range of medical questions.   

This is the first potential issue if incorrect details are entered or the information you gave was not answered correctly. 
Providers normally send you the medical information that has been disclosed and ask you to verify that it is correct (i.e. do nothing if it's correct but tell them if it's wrong).  This is your chance to check for errors.

I have confirmed with the advisor on the phone that the same person who handled my objection email is the same person who sent the letter. This seems retaliatory and vindictive on the face of it. I've recorded the telephone call.

There is no vindictiveness about it.   You could pretty much map their decision-making on a flow chart.  It won't be personalised specifically for you.
 
What has likely happened is that the change of details was done on the basis of it being an existing policy.   So, the underwriting for that would be a little different to a brand new policy being set up.   Then at some point, they have checked the original underwriting and found it wasn't disclosed (that is a normal thing to do).    They have then retrospectively (and correctly) looked at it again and made a new underwriting decision.

It may be that they have decided it's above their risk tolerance due to intentional non-disclosure, as DDG says above. 

It may be that 2023 is too recent for them to have considered offering cover in the first place.       Mental health issues that are event driven rather than clinical tend to become less of a concern with time passing but more of a concern if recent.   You bought in Junuary 2024 having suffered it in 2023.     So, I am leaning towards it being a recency issue and them saying they would never have accepted it in the first place had they known.   Its a guess but a fair one.

Event driven mental health that was one off and happened over a year old is frequently handled by an exclusion for mental health issues.    When the event was less than a year ago, it is often declined (or deferred).

It just all feels very slight of hand and they've latched on to what amounts of a very minor factor given that it was my intention to increase my cover and I did not tell them that I would not be proceeding with their new offer with the exceptions.

It's not minor.  
a) its mental health, and whilst mental health is perhaps overused nowadays, it is still mental health.   The fact is that you took time off work for mental health reasons.   It's a factual event.  
b) Non-disclosure of a material fact adds a second risk event for them to consider.

papaface

You need to be taking matters up with the person that sold you the policy and why there was the "error" on the form.  

Yeah I've asked for the document that was filled in as I don't have it, never seen it and it certainly won't be signed by me.

At the point of sale in the original application, you should have been asked a range of medical questions.   

This is the first potential issue if incorrect details are entered or the information you gave was not answered correctly. 
Providers normally send you the medical information that has been disclosed and ask you to verify that it is correct (i.e. do nothing if it's correct but tell them if it's wrong).  This is your chance to check for errors.

Appreciate that, but this categorically did not happen. I have never made this declaration and their records should show that it was not signed by me but by the financial advisor who never made me aware of this question. They said they would send me a copy of this document but I'm still waiting for it.

There is no vindictiveness about it.   You could pretty much map their decision-making on a flow chart.  It won't be personalised specifically for you.

I respectfully disagree as the advisor confirmed on the phone that the action was only taken on the back of my email to them, not before making their offer. They by definition knew about the 2023 instance as they put the exclusion in the new offer pricisely because of the 2023 instance therefore they must have known about it before making me the offer. I have never had any other "mental health" episodes in my life or since and never had any medication for it either because I don't need it.

It's not minor.  

I'm not saying mental health is minor. I am saying that they were demonstrably going to provide me with insurance knowing exactly the same information and gave me until the 11th Sept 2025 to confirm acceptance. Had I not challenged the exclusion I'd still be sitting here with an income protection policy. That's the point.

DullGreyGuy

papaface said:

It's not minor.  

I'm not saying mental health is minor. I am saying that they were demonstrably going to provide me with insurance knowing exactly the same information and gave me until the 11th Sept 2025 to confirm acceptance. Had I not challenged the exclusion I'd still be sitting here with an income protection policy. That's the point.

You challenged the decision so it was reopened. As was explained above, having reconsidered at your request they may have no realised the mental health incident was less than 12 months before the inception and therefore the policy should have been declined rather than non-standard terms. 

People always assume that by asking for something to be reviewed that the result can only get better but its not true, it gives them an opportunity to correct things in both directions and so you can get a worse outcome. 

papaface

I'm just grateful I know now rather than when I ever needed to make a claim in the future only for them to review and use it to avoid paying out.

I've spoken to my financial advisor and he says he'll have asked me on the phone if I took any medication for anything (which I rightly answered "no"), and he's taken that as an answer to answer this question which is very much more specific. I 100% did not ever know this question existed before doing the questionnaire myself in Feb this year.

I appreciate it from the perspective of the insurer, and if I was trying to game the system I would a) have never replied to them b) not answered it correctly in Feb.

This is clearly an oversight on the financial advisors side and I think Aviva need to take that into account especially in the context that they were actually going to continue providing cover to me on the new plan under exactly the same knowledge.

DullGreyGuy

papaface said:

I'm just grateful I know now rather than when I ever needed to make a claim in the future only for them to review and use it to avoid paying out.

Its one of those things where it depends, had you not pushed back on them and they had not reviewed the file you would have been in a much stronger position to argue over a claim being paid however had you made no contact at all and then had to claim under the original terms then yes there is a good chance a claim would have been declined for non-disclosure. 

papaface said:

I've spoken to my financial advisor and he says he'll have asked me on the phone if I took any medication for anything (which I rightly answered "no"), and he's taken that as an answer to answer this question which is very much more specific. I 100% did not ever know this question existed before doing the questionnaire myself in Feb this year.

I appreciate it from the perspective of the insurer, and if I was trying to game the system I would a) have never replied to them b) not answered it correctly in Feb.

This is clearly an oversight on the financial advisors side and I think Aviva need to take that into account especially in the context that they were actually going to continue providing cover to me on the new plan under exactly the same knowledge.

Then you should be complaining to your FA that they have made an invalid assumption and that has resulted in you having a policy cancelled. 

On point B, dont be so sure. A significant proportion of insurance non-disclosure is discovered by the insured dropping themselves in it. I accept its part of the reason why insurers repeat questions, to look for inconsistencies but in many cases they have nothing more to go on and had the insured been able to maintain their answers the outcome would have been very different. Plus we are talking about front line insurance staff questions, not the more intense cognitive questioning techniques of the counter-fraud teams. 

The FA is independently regulated, Aviva dont have to consider their mistakes but the FA must have appropriate insurance in place, is subject to the FOS and ultimately the FSCS is there if an award is made that the Advisor cannot afford to pay.