Life Policy

[Mamie]

Hi, In 1985 we took out a joint life policy with Abbey Life payable of first death value £19,935. We took a partial surrender in 1995 of £900.

 

Over the years because we did not increase the premiums the policy value went down and now stands at £6,987.

 

The reason for this post is to get some advice on what to do with this policy now as we have received a letter from Abbey Life.

 

This letter gives some information about your COVERMASTER Plan which will reach its 28th anniversary on the 25th June 2013.

Your COVERMASTER Plan is a unit linked life assurance policy.

 

The current review on this is to drop your current level of Life Cover of £6,987 to £5,994 until your next review.

 

You would normally have the opportunity to replace any reduction in your life cover by taking out a new life assurance plan with us for £993.

At present the cost to you of doing this would be below our minimum premium for new plans,

so we propose instead to maintain your life cover at the current level until the next review.

 

However you should anticipate a possibly substantial reduction in the level of your life cover at the next review

because we are proposing to maintain the sum assured at a higher level than we should until the next review.

 

The premium for this policy was £12 a month when it started it went up to £18 about 15 years ago.

 

What is the best way to go forward with this policy,

when we took it out we were told that the initial sum of £19,935 was for life no matter what,

do we surrender the policy or make it a paid up one as we are now 65 and 60 years old.

 

I would appreciate any help with this.

 

mamie

[honeybee13]

Hello there.

 

We're not authorised to give detailed financial advice here, as you may know.

 

If you don't need the life cover from the plan, it's worth looking into what your options are, like surrendering it or making it paid up to see how the figures stack up.

 

When is the policy meant to mature please?

 

My best, HB

[Mamie]

Sorry HB, did not realise that you could not give advice on this, the policy expires 2055 it will have paid out long before that.

Did phone them but when they gave me the options I did not really understand, was just hoping for what to do next.

 

Thanks anyway mamie

[unclebulgaria67]

Sounds like you need some independent financial advice to see what cover is relevant to your current and likely future needs.

 

Have a look in your local yellow pages for independent financial advisors or ask friends/relatives for recommendations.

 

On the Martyn Lewis site about saving money, there are a number of independent financial advisors who post to the Insurance forum, but obviously they still won't be able to offer you any specific advice. You will have to speak to someone. Perhaps phone the Abbey Life people first and find out about the policy you have with them. Then see whether you can obtain some local advice. But do ask about any fees, before you sign up for anything.

[Mamie]

Thank you for your reply, I will phone Abbey Life in the morning and ask them to write to me with options as I said in original post did not understand most of what he was saying, said he could not give exact amount on surrender or fees.

I just did not know how much it would cost us going to a financial advisor.

 

Many thanks again to you and HB