Customers were sold a product that covered two needs when only one was needed - and it ended up costing them dearly, when they could least afford it.
What is a Whole of Life Policy?
A Whole of Life Policy is a product created in response to two different needs - savings and life insurance. In most cases, only one function is actually needed, making the policies inherently unsuitable. The majority of people require life insurance for a fixed term only (a good example is cover until the mortgage is paid off, or to ensure the children are provided for). But once these commitments come to an end, there is little point in having a product which runs indefinitely.
A Whole of Life Policy can also be expensive. You're not only paying for insurance but also for the investment portion. That extra cost might almost be worth it if these policies were a good investment vehicle. But usually they aren't. The policies come with high fees and commissions and it's often impossible to tell what the return on the investment will be, and how much of what you pay in goes towards the insurance, and how much towards the investment.
The worst part of Whole of Life Policies is the risk associated with the investment element. Unlike other, safer and more suitable savings and life products, Whole of Life Policies are subject to periodic premium reviews. If the fund has performed poorly, you may be required to increase your premiums or reduce the life cover. This can result in you being left with less life cover than was originally required - meaning you won't be able to protect your loved ones in the way you intended.
The fact is, Whole of Life policies are complex and you'd be forgiven for feeling a little confused about whether you've been mis-advised. So we recommend you read the statements below. If any sound familiar, the chances are, you were.
1. You weren't adequately advised about the premium reviews
The premium on a Whole of Life Policy is reviewed at certain intervals, which means customers can suddenly find themselves being asked to massively increase their premiums or accept reduced life cover at a time when they actually need it. If you weren't aware of this, then you may have been mis-advised.
2. You weren't advised about the term of the policy
Most people only need life cover for a certain number of years, e.g. to protect their mortgage until it is repaid, or to protect the kids until they are old enough to support themselves. Once these commitments cease, the policy becomes an expensive ‘bonus' benefit on death. Other types of life cover - known as term assurances - have set terms and are usually far cheaper and more suitable for most people. Did you know this?
3. Your existing cover wasn't properly taken into account
Your adviser should have thoroughly assessed your existing life cover or savings products and options. If you were sold life cover when you already had enough, or were told to use your policy as a tax-free savings product when other more suitable products were available, then you were probably mis-advised.
4. You weren't properly informed about the investment risks
Were you made aware of the fact that the surrender value could be less than expected because an element of the value could have been going towards the premiums of the life policy?
5. You weren't fully aware of the costs tied into the policy
Apart from the risk of rising premiums and the cost of an indefinite term, these policies were loaded with high charges and fees from the start. Also, people often only needed a product which provided life cover OR savings, not both. This meant that many people were paying for something which they did not want or need. Does this sound familiar?
So what does all this mean to you?
If, having read the statements and case study above, you think you've been mis-advised about a Whole of Life Policy, then you could well have cause for complaint. The point is, someone advised you to take out a policy that was either unsuitable, too expensive or, worse still, both. We believe that's wrong - and a simple case of financial injustice. And that's why we're only too pleased to stand shoulder to shoulder with people like you - and work to get back what's rightfully yours.
What can you do to reclaim?
When it comes to making a claim against a Whole of Life policy, you only get one chance, so it's vital you give it your best shot.
There are two main options open to you. You can claim on your own, or you can use an expert. Now, we're not going to lie and say that we can guarantee you a payout, that you'll get more money with us or that we can handle the claim more quickly than you would on your own. Anyone saying this risks a call from the Ministry of Justice, which authorises and regulates Claims Management Companies.
However, what we do guarantee is an honest, expert, hassle-free service with no upfront costs. Now you might still be wondering who we are - and whether we're right for you. If so, we'd love to tell you a bit more about ourselves - and why over 700,000 people have trusted EMCAS with their claims.
If, on the other hand, you'd like us to work with you, contact us today. If you've been mis-advised about a Whole of Life Policy, you deserve financial justice - and the compensation that's rightfully yours. For a fast, free and no-obligation assessment from one of our friendly, down-to-earth advisers, click here.
We'll call you back as soon as possible - and together, we'll win back what's rightfully yours.