Halifax Critical Illness Miss-selling Settlement - Should I accept?

[Danzel47]

I received a phone call from Lloyds Banking Group in January 2014 regarding the products sold to me when I took out a mortgage in 2007! The call was unsolicited and I was informed that Lloyds, BoS and Halifax had commissioned a project to review a sample of products sold with mortgages.

The interviewer had my application from 2008 and discussed each question with me. He highlighted that the critical illness with life cover (CILC) carried a £3 fee and was this explained. I had no recollection and was annoyed to pay over 10% of my premium for pure admin.

I received the conclusion letter today offering me a full refund of the premiums paid plus an 8% interest rate.

Obviously I am ecstatic but should I accept the payment or ask for more? I know that these companies make you a nice offer to get a knee jerk acceptance and its all brushed under the carpet at a minor cost to the bank.

The period they have calculated is from Nov 2010 to January 2014 when they were cancelled as we changed mortgage. I first took a mortgage in 2007. The initial total sum of CILC was £138232 on a reducing rate. I have been offered £1400 refund.

If I can request more, how should I go about it? The letter I have states 'the products recommended were not the most appropriate.'

I appreciate any advice.

Thanks

[di30]

Re: Halifax Critical Illness Miss-selling Settlement - Should I accept?

Hi and welcome to LB

Did they actually provide you with the detailed breakdown.

So basically you should get back what you paid into the cover plus the relevant interest, so they should go by the year-date it was sold to you to cancellation of the cover.

Maybe it differs with this type of policy on how they calculate, so bumping up the same time for you, and hope someone that knows more of how they calculate of these policies will post up soon.

Good luck and well done!

[L'pool64]

Re: Halifax Critical Illness Miss-selling Settlement - Should I accept?

Good evening,

All my comments exclude any thoughts on the appropriateness of the cover you were sold.
When companies refund monies from "life & pensions" policies, which is what critical illness is normally classed as, there is a set formula that they follow. (Prescribed by the regulators) The monies that you have been offered, I e return of premiums + interest sounds about right. Regarding whether or not you should ask for more......by returning premiums + interest they have in the industry's eyes "righted a wrong", also you have had cover since inception of the policy. Additionally, they would argue that they have been proactive.
You may wish to make some enquiries of an IFA about replacement of the cover. It is likely if you wish to replace it, it could be obtained at a cheaper rate, assuming your health is o k. With regard to the monthly £3.00 fee.........; all companies charge something, that is how they cover costs and make some profit. The rules regarding life insurance have now changed and all costs must be disclosed fully.
Hope this helps.

best regards,

:beagle: