Life Problem with Mortgage Life Assurance

M

masterK

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About 3 years ago we topped up our mortgage, as part of the process we had to take out a new mortgage life assurance policy to replace the existing to cover the increased mortgage. The policy was with BOI, the advisor told us the new policy would replace the old one. The original policy was never cancelled and we have been paying 2 premiums for the last 3 years. We've contacted BOI who admitted they should of cancelled the existing policy. They've offered to refund half the premiums we've paid on the policy which should of been cancelled as they cliam they would of paid out on any claims on that policy even though the new policy covered exactly the same. We are not satisfied with this offer and feel we are entitled to a full refund.

Do we have any basis to get a full refund? If so and they refuse is there any avenues to pursue this?
 
Tell them you are going to contact the Insurance Ombudsman if they dont give you a full refund. They have admitted their mistake.

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I wouldnt accept this if they have admitted they are at fault.
 
If you requested the cancellation of the old policy in writing you are due a refund of all premiums, not just half of them. If you didn't provide a written request but you told your adviser the new policy was to replace the old one you will also be due a refund.

If they have your written request there is a good chance they would not have paid out in the event of a claim
 
Hold on a second here.

You have been paying two premiums for three years? And you did not notice it? So there was a monthly direct debit coming from your account and you did not notice it?

If you noticed it after around two or three months, then you would be entitled to a full refund. If I was the Ombudsman, I would award you around three months. It seems to me that the Bank's offer is extremely generous.

Brendan
 
sometimes the life assurance premium is billed with the mortgage.. so the op may have saw one mortgage payment and one life insurance payment a month, without realising the mortgage payment also included life cover.

Or, BOI might have combined the two payments into one DD so it would be not apparent it related to two separate policies.

I think the op has a case
 
Agree with Tenchi-fan, I regularly come across cases where the mortgage and life assurance/mortgage protection have been bundled into one payment by banks. Its not very transparent on their part and often clients get overcharged if they cancel their mortgage protection policy and take one out elsewhere.

If the bank was given an instruction to cancel the old policy, said they would do it and then didnt, they have overcharged. Its easy for them to say they would have paid a second claim when no claim occurred. People shouldnt have to check up on banks to ensure they do what they said they will do. They are meant to be safekeepers of our money, but all too often we see cases of overcharging that goes unpunished.
 
Yes we should of noticed the extra payment. It came from my wifes account and she thought we also had a mortgage income protection policy (we did but cancelled it). The DD appeared as BOI life for both hence the confusion.
 
Hi MasterK
I have also found my self in a similar position with the same response from BOI

I meet with the BOI life guy and arranged for an existing policy to be canceled. However it never was and so I had 2 policies for the last year for the same mortgage. Again I never noticed the deduction in my statement.. So you are not alone.
BOI have also informed me that the request was noted in my records at the time but it was not executed. How have you got on with this issue?
 
selfbuilder2 said:
BOI have also informed me that the request was noted in my records at the time but it was not executed. How have you got on with this issue?[/FONT][/COLOR]
Click to expand...
Hi
Don't deal with people over the phone - they're only customer service staff and their job is to get you off the phone within 3 minutes. I was one of them (not in BOI) and I was very effective at dealing with such calls.

My advice.. Put it in writing! Type up a letter, keep it letter short and to the point, stating you want a full refund immediately (plus interest - because sometimes they add a bit extra as a goodwill gesture rather than attempting to calculate interest!)

State in your letter you want it set up as a complaint and you wish to go to the ombudsman if you do not get a satisfactory response.

Insurance companies have a certain length of time to deal with complaints (as opposed to customer service queries) and if they can't resolve your complaint they must provide you with a sign-off letter which will allow you to make a complaint directly to the ombudsman.
 
selfbuilder2 said:
Hi MasterK
I have also found my self in a similar position with the same response from BOI

I meet with the BOI life guy and arranged for an existing policy to be canceled. However it never was and so I had 2 policies for the last year for the same mortgage. Again I never noticed the deduction in my statement.. So you are not alone.
BOI have also informed me that the request was noted in my records at the time but it was not executed. How have you got on with this issue?
Click to expand...

Hi,

I had originally wrote to them to outline my case to which they replied accepting responsibility but stating they were only willing to refund half of the premiums. They supplied the details of a guy to call if I wished to discuss the matter further, he never returned my calls. I again wrote to them stating my intention to pursue the matter with the fincancial ombudsman to which they replied saying pretty much the same thing the had originally. I am now going to make a complaint to the fincancial ombudsman.

They did reply promptly to both of my letters.

Has your case progressed any further?
 
This has frequently happened where payments are lumped into one payment I would surprised if the bank didn't refund in full . Ask to see a copy of the factfind. If it says that new policy is replacing old one, they are at fault as you came to them for advice. This is a reason why everyone should have a living will. Keeping mortgages separate from life policies would also help. Good luck.
 
How did this situation unfold?
Can anyone advise on this issue: life cover taken with a 1st morgage, realised being seriously overcharged and wrote to bank to cancel and took new policy out, paid directly in full, sent documents to bank etc.
Bank are still taking original premium, have now charged 2 or 3 months additional life cover, taken out with mortgage payment.
They have acknowledged receipt of new policy but are telling me that you pay a month in advance, i.e. july payment now covering june premium, BS in my opinion, what if u died in June, would they wait till July for their premium and still provide cover?!!
Does anyone know if the bank are obliged to refund me from the date that the new policy was in force, i.e double cover, or from when they received the policy which was the end of May 2010?
 
If you pay a life assurance premium by monthly Direct Debit, you pay monthly in advance so if you pay a premium today, 12th July, that premium covers you from today until the 11th August.

However if the bank were paying your premium and charging it to your mortgage account they may have had a delayed method of charging the premium to your mortgage account. But two or three months seems excessive. Ask for an explanation in writing.
 
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