Can an insurance company cancel a policy without notification?

Have you tried calling them?

Although depending on how much you are paying you might be better off self insuring... I know a contractor who was paying somehting daft like £400per month, although they were earning about £400 per day.

in that scenario surely you'd be better off putting that £400per month into a mixture of investements, like a managed fund or something?

It depends what the contract says. Which you have, and we don’t. <br /><br />

But… I would bet that there is a right of termination clause for the insurance co. in there.

Saying that, no confirmation or warning letter sounds like cock-up rather than conspiracy 

I’ve tried mailing them, they don’t accept calls! I took it out 12  years ago so no idea what the contract says tbh.

Have you changed your postal address, email address or phone number in the last 12 years? Any chance they have told you but using old contact details?

Have you changed your postal address, email address or phone number in the last 12 years? Any chance they have told you but using old contact details?<br />

Hmm actually this is relevant and I omitted perhaps important info in op. In august Barclays (who I took the policy out with but aren’t the policy provider apparently) contacted me saying they had failed to update my address on the system and we’re going to give me 50 quid as ‘compensation for inconvenience’. the inconvenience quoted being that I wouldn’t have received statements. Apparently the issue was rectified. They certainly never mentioned anything about my policy being canceled <br /><br />

if their cock up has meant I’ve had my policy cancelled then I’d be expecting far more than 50 quid compensation tbh

I had income protection insurance for years as well. They wrote to me about 2 years ago to say that it was coming to the end of its 25 year term. I didn't know it had a 'life' so your might have also come to the end of it's life rather having been cancelled

Sounds like they've done you a favour if you aren't that worried about your finances if you lose your job and have no idea what the T&Cs of your policy are.

no idea what the T&Cs of your policy are.

I remember what it paid out, what it covered and the exclusions. I don’t remember. I can’t remember any small print about them being able to cancel without telling me..

if their cock up has meant I’ve had my policy cancelled then I’d be expecting far more than 50 quid compensation tbh

Why? You've lost nothing

There's not a possibility that the contract was for a set period - say 10 years?

Why? You’ve lost nothing

yes I did, as to take out similar to what I had on a new policy will cost double what I was paying.

Do you have absolutely no means of contacting the company?

If so, would you really want them to continue covering you?

Insurance can a bit of a scam.. did you claim last year? in the last ten years?
If no, you'd expect a lower renewal, not just pay them the same or a cancellation.
In the case of the OP, you have to assume that you are no longer insured under the terms you agreed with ten years ago.

Reading between the lines, it was a crap policy and it got forgoten via a merger or something.

I'd be really interested to see the t&s and C's... but if you've got radio silence from your insurance company,  it's safe to assume you are no longer insured.

You should take steps to make alternative arrangements, as they say.

How much per month had you been paying? It could fall under unfair contract law, coercion, etc.

Hi 

Not sure how you have tried contacting the insurance company but if all fails, I would take to twitter in instagram.  Companies do not like being ‘criticised’ on social media.  I’m a  mortgage and protection broker, ie. One of these people that advise on this kind of stuff. 

A new financial service legislation came in this year, called consumer duty.  It is a new set of guidelines set up by the FCA (the regulator) to ensure companies are being fair, (although still questionable in my opinion).  Companies need to ensure  ‘Firms must take all reasonable steps to avoid causing foreseeable harm to customers; enable and support customers to pursue their financial objectives, and act in good faith’ - regulators words not mine.

Even if there has been a merger/takeover there will be a department somewhere that should be able to assist.  Who was the insurance company?<br /><br />Even as a broker, insurance companies are painful to get hold of sometimes, press 1 for this, 2 that…… etc but someone somewhere will be accountable.  Feel free to message me the insurance company name and I’ll see what I can find for you.

Stu 

Cheers Stu, I’ll give them till the end of the week to respond then I may take you up on your kind offer 

yes I did, as to take out similar to what I had on a new policy will cost double what I was paying.

Sorry - you're right, I take back what I said. I missed that detail.

So I got a response. Apparently they sent a cancellation letter on the 9th May, telling me they were withdrawing cover on the 30th June. They withdrew cover as they decided they no longer wanted to offer this kind of cover as a product . I never got the letter as they had not changed the address on the system (they have admitted this error) I have several issues with this. 

1. firstly, how on earth are they allowed to withdraw a product that I have been paying into for 12 years at less than 2 months notice? That would not give me time to arrange any kind of replacement cover as there is usually at least a 3 month exclusion on these products

 2 . they claim they have not offered this product to new customers for over 10 years. As such it’s pretty clear that they knew fairly well in advance of may they were planning to withdraw this cover. If I’d know that I would have cancelled immediately as my role is was fairly secure for time being, the likelyhood of me losing my role in the period between them making the decision to withdraw and the end of my policy would be minimal. He only reason I kept paying is that I knew further down the line it may be hard to find such an insurance product at a comparable price. They even admitted on the phone that they would usually give 6 months notice of withdrawal 

3. they claim that in the ts&cs they can terminate the insurance by notifying me. They didn’t notify me, hence they are in breach of their own conditions I’m not usually one to claim compensation from a company, however given I’ve worked out I’ve put 7k into the policy, I don’t t feel they’ve followed due process, and more importantly it’s an insurance company (so screw them), I’ve submitted a complaint

But they did notify you...just at the wrong address and that was the banks fault (you said the bank was the broker but not the provider).

I'm not entirely sure what you're expecting?

AFAIA a company does not have to continue offering a service/product just because they did do previously.

they claim that in the ts&cs they can terminate the insurance by notifying me. They didn’t notify me, hence they are in breach of their own conditions

Almost certainly they can cancel it. If they can it'll literally be in black and white in the wording.

However, best practice would be to use 2 methods of contacting you. Which in this case it doesn't sound like they've done.

In your OP you say you haven't paid for 4 months so check your payments are correct if it cancelled in June.

I’m not entirely sure what you’re expecting?

This. It's an insurance contract from what you said. It's not an investment. There isn't a return. So when it stops, both sides walk away. They won't be responsible for your increased costs for a new policy.

This doesn't stop you complaining though, and I think you might get a goodwill gesture due to the cockup.

It’s the banks product, they were involved in making the decision to cancel it

I’m not entirely sure what you’re expecting?

well at the very least, by not notifying me I spent an extra 2 months on premiums that I want back. I also don’t think it’s remotely fair that they only need to give 2 months notice (even the lady I spoke to thought it was 6). So I will be asking for at least that amount of month’s premiums back as I would have canceled as soon as i became aware.

the other point is they are in breach of the contract as they did not notify me of the termination. They are so useless they wrote to me 2 months after the termination date informing me that my address has been updated so I can now receive statements!

I’m certainly not expecting 7k back, but I am expecting a bare min of 2 months premiums!

AFAIA a company does not have to continue offering a service/product just because they did do previously.

Ford don't make the Escort anymore, they must owe me, surely?

Ford don’t make the Escort anymore, they must owe me, surely?

great analogy, thanks for your input 👍

1. firstly, how on earth are they allowed to withdraw a product that I have been paying into for 12 years at less than 2 months notice? That would not give me time to arrange any kind of replacement cover as there is usually at least a 3 month exclusion on these products

Why on earth would they not be permitted to withdraw a product just because they used to offer it.  If you organise new cover and the new cover does have an exclusion for claims in the first 3 months then you MAY have a reason to be aggrieved if a claim arose between month 2 and 3.   Would you have expected to have to provide them prolonged notice if you no longer wanted cover.

 2 . they claim they have not offered this product to new customers for over 10 years. As such it’s pretty clear that they knew fairly well in advance of may they were planning to withdraw this cover. If I’d know that I would have cancelled immediately as my role is was fairly secure for time being, the likelyhood of me losing my role in the period between them making the decision to withdraw and the end of my policy would be minimal. He only reason I kept paying is that I knew further down the line it may be hard to find such an insurance product at a comparable price. They even admitted on the phone that they would usually give 6 months notice of withdrawal

It wouldn't necessarily be obvious they were going to bin the legacy customers too.  I suspect that the rising cost of mortgages and probably a falling number of legacy customers means they would decide to bail out earlier than previously planned.

3. they claim that in the ts&cs they can terminate the insurance by notifying me. They didn’t notify me, hence they are in breach of their own conditions

What is your loss?  It seems you are now notified, so they can now terminate.  It seems you didn't have a claim during the "limbo period".  If you had had a claim during the limbo period the regulator/ombudsman may well have upheld your complaint (ie. made them pay) - there would come a time period where they would say you should spot (as you did) that you weren't paying any more.

I’m not usually one to claim compensation from a company, however given I’ve worked out I’ve put 7k into the policy, I don’t t feel they’ve followed due process, and more importantly it’s an insurance company (so screw them), I’ve submitted a complaint

You've benefited from some comfort and reassurance, thats what you pay insurance for.  Alternative products were available which offered different types of critical illness type cover but which were also investment vehicles.  They cost more / paid less, but you expected to get a return.

What is your loss?<br />

well at least 150 quid straight off the bat from 2 months premiums I wouldnt otherwise have paid 

I’m not disputing the fact they can withdraw a product. I’m disputing the fact they cocked up and didn’t inform me as they are obliged to do in their own t’s and c’s. 

Although depending on how much you are paying you might be better off self insuring… I know a contractor who was paying somehting daft like £400per month, although they were earning about £400 per day.

in that scenario surely you’d be better off putting that £400per month into a mixture of investements, like a managed fund or something?

Kind of depends what type of cover you get.  Income protection can cover redundancy, critical illness, long term sickness etc.  It can simply pay the mortgage, it can pay a lump sum or it can keep paying you a sizeable chunk of "salary" right up to your normal retirement age.  The consequences of "making a claim" after a year v 20 years, and the claim being for 6 months loss of income, v's the rest of your career, are very different.

well at least 150 quid straight off the bat from 2 months premiums I wouldnt otherwise have paid

Why wouldn't you?*

This is not a loss..... You were still covered during this time.

In one sentence you say you kept paying because it would cost you more to replace it, and then you say if you'd known that if the policy was going to stop then you'd have cancelled earlier - this makes no sense at all.

* You kept paying [because it was cheap] even though you felt you didn't really need it thanks to perceived job security but you would have stopped paying if they said they were stopping the policy in 2/4/6 months time.
Huh?!!

In one sentence you say you kept paying because it would cost you more to replace it, and then you say if you’d known that if the policy was going to stop then you’d have cancelled earlier – this makes no sense at

 If they told me in May they are cancelling the product, and I can no longer claim after 30th June, then it would have been clear to me that it was no longer worth paying for. For a starter my consultation and notice period would mean I’d still have been employed on 30th June and therefore couldn’t have benefited from it (even if I’d been informed of any impending redundancy the day I received the letter)<br /><br />

So by not telling me, I paid for at least 2 months protection that I couldn’t possibly benefit from.   

If they told me in May they are cancelling the product, and I can no longer claim after 30th June, then it would have been clear to me that it was no longer worth paying for. For a starter my consultation and notice period would mean I’d still have been employed on 30th June and therefore couldn’t have benefited from it (even if I’d been informed of any impending redundancy the day I received the letter)

Without seeing the T&Cs we can't know if the bit in bold is accurate.  e.g. if they terminate the policy can you initiate a claim during the termination for a redundancy which is under consultation?  it would seem that there must be some protection otherwise an astute insurer would just monitor social media for companies that go into consultation and drop the policies of those insured during the consultation period!  You'll also know if there is any prospect of the firm just going bust and leaving the receiver/administrator/state to pick up the mess without consultation periods.  I'm also surprised if the policy only covers redundancy.  What about injury or illness?  

If your assertion that your job security is so good you would never make a claim at short notice it somewhat undermines your claim that:

That would not give me time to arrange any kind of replacement cover as there is usually at least a 3 month exclusion on these products

FWIW I get that its frustrating that insurance policies can be cancelled at the whim of the insurer.  The same happens with road traffic policies (usually then because of some fault by the insured, like not paying/sending NCD/driving license etc).  If it was up to me, then to cancel insurance the insurer would have to prove they had served the cancellation - not just posted it.

Without seeing the T&Cs

I have a copy in front of me!

 

it would seem that there must be some protection otherwise an astute insurer would just monitor social media for companies that go into consultation and drop the policies of those insured during the consultation period

I suspect they’d be on a sticky wicket if they cancelled individual policies after any announcement of restructuring in the news tbf. But regardless, there was no way I was going to be made redundant at that point anyway given I’m critical to a project until early next year. I would have happily kept paying the premium if they hadn’t cancelled however, as who knows what will potentially happen after that.

not just posted it

they aren’t even trying to pretend I received it and fully acknowledge they cocked up.

I’m also surprised if the policy only covers redundancy.  What about injury or illness?  

Specifically only covered redundancy on my policy. Work covers me for the others so it wasn’t required. Nowadays you can’t get redundancy only, it’s packaged with injury and illness, hence why it’s far more expensive to find a new policy

edit..the ts and c’s also specifically calls out the fact you need to continue to make payment during the period of redundancy to continue to receive payment from the insurance if you claim. Which would clearly be impossible if they’ve shut down the product!