Mis-sold Life Insurance?

[freelance]

Hello there,

 

I'm wondering if anyone can give me their thoughts on the following.

 

Repayment Mortgage applied for in 1997, first time buyer, single, no dependents, self employed. Bank insisted on Life Insurance as condition of mortgage. I understand that even though Life Insurance is not an appropriate product for single person/no deps that banks routinely demanded the insurance anyway during this era and were allowed to do so. Bank arranged for advisor to call specifically to sort out Life Insurance required for mortgage, advisor aware that there was absolutely no prior knowledge of any insurance products at all and life cover to fulfill mortgage application was only criteria. Advisor recommended Level Term Assurance with Critical Illness. Critical Illness discussed only as part of Life Insurance product, need for critical illness cover not discussed at any other time and no mention made that this was a consierably more expensive combined product not a standard Life Insurance policy, the latter being all that was required. Advisor recommended the product as ' best value for money' without providing details for any other products. Also failed to explain that premiums could rise. Correct paperwork sent through including 'reason why' document and medical questionaire etc but nowhere on paperwork did it explain that this was a combined product, just a Level Term Assurance product, did not state LTA was available without CI or that CI was optional anywhere. Policy taken out in good faith as trusted bank completely.

 

Shortly after policy taken out bank stopped demanding Life Insurance as condition of mortgage products - failed to inform, only found out by chance in 2011 so single person no dependants has been paying for combined Level Term Assurance (for no reason) and Critical Illness (unwittingly) for 14 years including two price hikes. Policy cancelled immediately and complaint lodged.

 

Bank has already issued a final response saying not a mis-sale but advisor also mis-sold PPI during same sales call, (PPI upheld by FOS)

 

Is it worth taking the Life Insurance to the FOS as a mis-sale - it doesn't seem right at all. At the very least wouldn't Decreasing have been the appropriate starting point (which was a a product they had available at the time I've since found out) if it's accepted that the Life Insurance was a condition of the mortgage in 1997, however inappropriate.

 

Many thanks - hope that makes sense

[freelance]

Bump

[unclebulgaria67]

I think the reason for lack of response is that most people don't have much knowledge of life Insurance products. This is probably why banks could sell the policies without too much of a problem. I would have thought that even for a single person, there was some cover provided by the policy, in the event of your death. If this is the case, you then get into the argument, as to how much of the premium you paid related to the cover that was of any benefit to you.

 

In this situation, if you are absolutely certain that the policy sold to you, did not provide any benefit at all, as none of the cover applied to you, then yes make the complaint to the FOS. You might as well make the complaint anyway, as you have nothing to lose, apart from a little bit of time making the complaint.