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  • FIRST POST
    • Cotta
    • By Cotta 10th Jan 18, 3:54 PM
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    Cotta
    Histroric Insurance with Mortgage
    • #1
    • 10th Jan 18, 3:54 PM
    Histroric Insurance with Mortgage 10th Jan 18 at 3:54 PM
    Hi All,

    In my younger days, long before I became aware of MSE I took out a mortgage (in and around 2010). At the time the bank insisted that I must purchase their insurance that was underwritten by Liverpool Victoria. It was for critical illness cover, I advised strongly that I did not want this but the bank insisted it was purchased before I had my mortgage approved. Whilst the costs were not massive it was an extra 100 per month that I had to pay and this went out for four years.

    I recently asked my bank at renewal why I no longer had to take out these insurance packages, only to be told the bank have nothing more to do with those policies based on how they were sold and their validity.

    This got me interested so last year I queried this policy, the bank denied they sold it to me so I contacted Liverpool Victoria directly who advised that it seems to have been sold by a third party intermediary. Today after a year it appears that the policy was indeed sold by the bank directly but the bank are unsure how this came about and why as such sales look highly unregulated. There does also seem to be some evidence that I took out the policy at the time "very much under protest".

    I know this is very rambling, however have I any right to ask for a refund?
Page 1
    • YHM
    • By YHM 10th Jan 18, 4:07 PM
    • 537 Posts
    • 198 Thanks
    YHM
    • #2
    • 10th Jan 18, 4:07 PM
    • #2
    • 10th Jan 18, 4:07 PM
    Why a refund? Say you contracted a condition that were covered on the policy and it paid off your full mortgage, would you be complaining then?

    What evidence can you pull together that says you were coerced into taking insurance?
    I am a Mortgage Broker.

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice
    • Cotta
    • By Cotta 10th Jan 18, 4:09 PM
    • 2,725 Posts
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    Cotta
    • #3
    • 10th Jan 18, 4:09 PM
    • #3
    • 10th Jan 18, 4:09 PM
    Why a refund? Say you contracted a condition that were covered on the policy and it paid off your full mortgage, would you be complaining then?

    What evidence can you pull together that says you were coerced into taking insurance?
    Originally posted by YHM
    I had insurance for such already elsewhere, the bank insisted it should be with them.
    • ACG
    • By ACG 10th Jan 18, 4:11 PM
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    ACG
    • #4
    • 10th Jan 18, 4:11 PM
    • #4
    • 10th Jan 18, 4:11 PM
    You would need to complain to whoever sold the policy. LV will/should know who sold it.

    You can make a complaint in writing to the company that sold the policy. They will investigate and let you know the outcome. If unhappy, you can then take your complaint to the ombudsman.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • kingstreet
    • By kingstreet 10th Jan 18, 4:12 PM
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    kingstreet
    • #5
    • 10th Jan 18, 4:12 PM
    • #5
    • 10th Jan 18, 4:12 PM
    In 2010 such sales were FSA (now FCA) regulated.

    You should make a complaint to the organisation which sold/advised and allow them to investigate the complaint. They have eight weeks to investigate before providing you with a final outcome.

    If you are unhappy with that, you can escalate the matter to the FOS where he decision is binding on the firm concerned.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • Cotta
    • By Cotta 11th Jan 18, 10:50 AM
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    Cotta
    • #6
    • 11th Jan 18, 10:50 AM
    • #6
    • 11th Jan 18, 10:50 AM
    The bank are looking into it now, I felt it was better to ask the question rather than do nothing.
    • Cotta
    • By Cotta 19th Jan 18, 12:59 PM
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    Cotta
    • #7
    • 19th Jan 18, 12:59 PM
    • #7
    • 19th Jan 18, 12:59 PM
    The bank have denied any knowledge of the insurance policy, the insurance company that the policy was with have confirmed it was sold from the bank through and IFA. The IFA was an employee of the bank, the bank have conceded this is highly unusual and don't understand what has happened on their side - the investigation continues.
    • dunstonh
    • By dunstonh 19th Jan 18, 1:33 PM
    • 93,042 Posts
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    dunstonh
    • #8
    • 19th Jan 18, 1:33 PM
    • #8
    • 19th Jan 18, 1:33 PM
    At the time the bank insisted that I must purchase their insurance that was underwritten by Liverpool Victoria.
    Which bank? I wasnt aware LV had a tied relationship with any of the banks.

    I recently asked my bank at renewal why I no longer had to take out these insurance packages, only to be told the bank have nothing more to do with those policies based on how they were sold and their validity.
    The retail distribution review came into effect on 1st Jan 2013 and most banks pulled out of the advice market at that point. Some maintained an insurance only salesforce whilst others called it a day altogether.

    This got me interested so last year I queried this policy, the bank denied they sold it to me so I contacted Liverpool Victoria directly who advised that it seems to have been sold by a third party intermediary.
    Which makes sense given my earlier comment.

    Today after a year it appears that the policy was indeed sold by the bank directly but the bank are unsure how this came about and why as such sales look highly unregulated.
    Which then brings us back to square one. Regulation of insurance started in Jan 2005. However, the bank can only sell from the provider it is linked to (banks were virtually all tied agents and not IFAs).

    There does also seem to be some evidence that I took out the policy at the time "very much under protest".
    What evidence?


    The bank have denied any knowledge of the insurance policy, the insurance company that the policy was with have confirmed it was sold from the bank through and IFA.
    Which bank? There were only a handful that had an IFA service or multi-tied offering.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • Cotta
    • By Cotta 19th Jan 18, 2:53 PM
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    Cotta
    • #9
    • 19th Jan 18, 2:53 PM
    • #9
    • 19th Jan 18, 2:53 PM
    Which bank? I wasnt aware LV had a tied relationship with any of the banks.


    The retail distribution review came into effect on 1st Jan 2013 and most banks pulled out of the advice market at that point. Some maintained an insurance only salesforce whilst others called it a day altogether.



    Which makes sense given my earlier comment.



    Which then brings us back to square one. Regulation of insurance started in Jan 2005. However, the bank can only sell from the provider it is linked to (banks were virtually all tied agents and not IFAs).



    What evidence?




    Which bank? There were only a handful that had an IFA service or multi-tied offering.
    Originally posted by dunstonh

    Bank of Ireland, the product seems to have been sold by their employee on behalf of an IFA.


    The evidence appears to be in the form of emails I sent at the time protesting the sale and advising that I did not want it.
    • dunstonh
    • By dunstonh 19th Jan 18, 3:08 PM
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    dunstonh
    Bank of Ireland, the product seems to have been sold by their employee on behalf of an IFA.
    ahh. Not a bank I have much knowledge of. Most of the banks tied themselves to a single provider. Usually L&G, Aviva, Scot Widows etc. Not a small, niche player like LV.

    The IFA takes the liability for sales made through their agency. Even if they involved third parties.

    In the past, I have sat in a building society branch and put in place products despite not being an employee of the building society. Once upon a time, that was very common. It's virtually unheard of nowadays and I haven't done it since the 90s. In 2010 you would not expect it.

    This is a most strange scenario you describe.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • Cotta
    • By Cotta 19th Jan 18, 3:18 PM
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    Cotta
    ahh. Not a bank I have much knowledge of. Most of the banks tied themselves to a single provider. Usually L&G, Aviva, Scot Widows etc. Not a small, niche player like LV.

    The IFA takes the liability for sales made through their agency. Even if they involved third parties.

    In the past, I have sat in a building society branch and put in place products despite not being an employee of the building society. Once upon a time, that was very common. It's virtually unheard of nowadays and I haven't done it since the 90s. In 2010 you would not expect it.

    This is a most strange scenario you describe.
    Originally posted by dunstonh

    The investigating officer from the bank has stated the same as you, in fact it's taken many month to even find this policy.


    What could have happened and what could I expect as a potential outcome?
    • dunstonh
    • By dunstonh 19th Jan 18, 3:44 PM
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    dunstonh
    What could have happened and what could I expect as a potential outcome?
    Given the strangeness of the scenario, it is really difficult to say.

    However, maybe the staff member was leaving the bank to work for that IFA and decided to use them instead of the bank product (IFA product would be cheaper and frequently better quality). Or maybe they didnt have a bank product that met your requirements and the staff member got a local IFA to do it (not common but I had Barclays ring me last year to do something on one of their customers as they couldnt do it).

    Whatever the circumstances were that caused it to happen, the fact it went through an agency of an IFA means that IFA is liable for the advice they gave. However, the IFA not liable for the advice given by a third party. Especially if the IFA didnt know the advice was even being given. The staff member may well have been paying you and playing the IFA. The bank is only responsible for the actions of their staff member.

    I'm looking forward to you keeping us updated and well done on getting such a weird scenario!!!!
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • Cotta
    • By Cotta 22nd Jan 18, 10:54 AM
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    Cotta
    The bank have now identified that the member of staff who sold the insurance policy to me in 2010 was a Financial Advisor working for them until 2014.
    • dunstonh
    • By dunstonh 22nd Jan 18, 11:27 AM
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    dunstonh
    The bank have now identified that the member of staff who sold the insurance policy to me in 2010 was a Financial Advisor working for them until 2014.
    Originally posted by Cotta
    Although it doesnt explain how this person was able to process business through an LV agency belonging to a third party.

    Still most weird.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • Cotta
    • By Cotta 22nd Jan 18, 11:57 AM
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    Cotta
    At least he's been identified as a member of staff for the bank rather than a rogue intermediary within the bank which is what had been previously suggested by the investigating Manager.
    • Cotta
    • By Cotta 5th Feb 18, 10:56 AM
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    Cotta
    An update of sorts, the IFA have sent documents to the bank confirming that the policy was sold to me by the bank. The bank are now willing to concede this point and are investigating further.

    It's taken over one year for the bank to concede this point, who knows what will happen next.
    Last edited by Cotta; 05-02-2018 at 12:48 PM.
    • Cotta
    • By Cotta 7th Feb 18, 12:33 PM
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    Cotta
    I called today for an update, the news was not what I was hoping for, headline points are as follows:

    1. New complaint handler has only picked up the complaint since yesterday afternoon.

    2. It's going to take five working days to retrieve my file from the archives.

    3. New complaint Manager is unhappy that it has taken one year to get to this stage, he has also expressed unhappiness that he is being "forced" to prioritise this complaint ahead of others - this seems to be pressure from his Manager.

    4. The bank frustratingly have refused to accept that they sold the policy despite my previous call to the bank. All the complaint Manager was prepared to concede was that a document has been uncovered with Bank of Ireland headed paper which suggests it was sold by them but at present they are gong on the IFAs say so.

    5. Bank of Ireland are refusing to say if the product was sold by a member of their company, despite it being done in branch, being a stipulation of the loan and the fact the employee has been deemed to be a Bank of Ireland employee at the time of the sale.

    6. Complaint Manager conceded that back in September of 2017 he was briefly brought into this complaint to look for the file, however he couldn't find it and nothing was communicated back to me that this had happened.



    I noted the following points in my call:

    a) It's taken one year for Bank of Ireland to investigate this - this was refuted by the complaint Manager who has insisted it's at 51 weeks at present.

    b) It takes a long time to get through when calling up (sometimes one hour), and I have been chasing this up regularly throughout the year.

    c) The buck for this policy has to stop with Bank of Ireland as it was sold by their employee within branch and as a stipulation of the mortgage.

    I am exhausted by this, I've no idea what is happening or where this will lead. What does everyone advise?
    Last edited by Cotta; 07-02-2018 at 12:37 PM.
    • Outsider_83
    • By Outsider_83 7th Feb 18, 4:03 PM
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    Outsider_83
    You need to be realistic, the company have stonewalled you for over one year. Nothing positive is going to come from this - at most you will get an apology for how long it have taken to investigate - 10 goodwill gesture.
    • Cotta
    • By Cotta 7th Feb 18, 6:46 PM
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    Cotta
    I'm confused at present, I might need advice on this one.
    Last edited by Cotta; 08-02-2018 at 9:33 AM.
    • Cotta
    • By Cotta 16th Feb 18, 1:09 PM
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    Cotta
    Well it's off to the Ombudsman, the bank have said they have acted fairly in selling this insurance.

    75 was offered for the delay of 13 months in responding and for me having to chase regularly throughout the 13 months, sometimes being on the phone for one hour at a time.
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