Can a life insurance cancel my policy just because they want to?

MmmStilton

I have a had a company group life insurance for over 20 years now, and kept it even after retirement.

The monthly premium being taken out of my salary/pension automatically.

I have just recieved a very impersonal notification that they have decided to end the existing group scheme.

I've been given a months notice, and been told to take out a new policy, but being 72 years old they will not accept me as they've got a 70 year old age limit.

Can they just decide to end a scheme that I have been paying into for over 20 years?

It's pretty shabby treatment if they can.

user1977

Presumably this is genuinely just life insurance and not some sort of investment vehicle? So you're not "paying into" it any more than you pay your home or motor insurance, it's just a premium covering your risk for the coming year? So yes, they can withdraw it whenever they want.

The money saving approach would be of course to have made a claim as early as possible...

Aretnap

It will depend on the terms of the policy, but if it were a personal life insurance policy then generally it would run for a fixed term (or sometimes whole of life) and so long as you kept paying your premiums the insurance could not cancel the policy before the end of the term.

A group policy is somewhat different however. It's primarily arranged between the employer and the insurer and access is provided to it as an employee perk. If life insurance is/was written into your employment contact then you might have a claim against the company but usually these things are non-contractual perks which can be withdrawn at any time. It's a bit late to say it now, but that's party of the reason why a group/employment-linked life insurance policy is inferior to a personal one, and shouldn't really be considered as a substitute.

Do you actually need life insurance? Most retired people don't. Is there anyone financially dependant on you who wouldn't have adequate provision if you died before then?

dunstonh

Can a life insurance cancel my policy just because they want to?

No. They would need a reason for doing so. It wouldnt be on a whim.

I have just recieved a very impersonal notification that they have decided to end the existing group scheme.

Is it the employer or the insurer that led to that decision? i.e. if the employer no longer wanted to offer it, then the insurer would go on to end it.

The employer is the life insurance company's customer with group schemes. Not you. The employer should be explaining what is going on and why. The insurer would therefore be less personal for he members of the group scheme.

What has the employer said about this?

Can they just decide to end a scheme that I have been paying into for over 20 years?

Your timescale paying into it doesnt matter with pure life assurance. Its effecitvely pay as you go. You didn't die so it doesn't matter if you were paying 20 days or 20 years.

But yes, they can decide to end a scheme with a valid reason. Usually, its the employer that is the driver behind the decision.

It's pretty shabby treatment if they can.

No its not because there will be a reason.

MmmStilton

https://forums.moneysavingexpert.com/discussion/comment/81904735#Comment_81904735

Thank you for the detailed response.

I've now written to the insurer to request more information about why the scheme ended.

The letter received wasn't even addressed to me, (well the envelope was), and did not have a policy or account number, just a flyer type letter.

MyRealNameToo

You may be better off speaking to your former employer given they are ultimately the policyholder and will have had conversations with their insurer.

MmmStilton

Just received the policy and this is part of it

Do I ask for my premiums to be refunded considering that I retired in 2006 so effectively left employment?

I'm also over 70.

dunstonh

Do I ask for my premiums to be refunded considering that I retired in 2006 so effectively left employment?

As you are still alive, I would be inclined to ask for a refund of premiums since 2006

Weighty1

This seems very unusual in that in many instance group life insurance policies are funded by the employer. In those were there is a voluntary uptake any deductions would normally be taken from your salary.

How come these premiums were being taken directly from your own bank account?

MmmStilton

https://forums.moneysavingexpert.com/discussion/comment/81918427#Comment_81918427

They were being taken from my monthly works pension.

MmmStilton

https://forums.moneysavingexpert.com/discussion/comment/81917225#Comment_81917225

I have done now.

I would assume if I had died, they would have just quoted the policy and refunded the payments rather than actually paid out the insured amount.