View more on these topics

Claims go up in smoke

Following a recent heart attack, a client claimed on several critical-illness policies held with Legal & General, not set up through myself, only to be told that for two out of the three policies, he would not be paid out due to non-disclosure of smoking at the time of the applications.

Following this, his other two policies for life cover were reviewed and cancelled from outset, with premiums refunded.

One of these policies I had set up three years after the others on assurances that he had given up smoking for over12 months, evidently then restarting again.

How L&G can justify the cancellation of this latter policy after this time is dubious at best, without a steady list of evidence during the intervening period. As a result of this, I now face a full clawback of all commission paid three years ago, with a full premium refund to the client.

Time and service has now been given for no payment whatsoever and
I feel that this treatment by Legal & General is very unfair and excessive and is in breach of the treating customers fairly doctrine, as I consider that advisers are the customers of the insurance companies.

Surely, what should be the fairest outcome is for the client to lose the premiums paid and for a proportionate clawback of commission to be taken.

I have also for a while now wanted to insert a paragraph into my terms of business letter to allow a cost reclaim from the client where clawback occurs where no fee is agreed for services. However, this is apparently also currently not permitted by the regulator.

This places us between a rock and a hard place once again. How are we expected to protect ourselves from unscrupulous clients and also make a decent living in such a regime?

We are held to ransom where the client is disadvantaged. Why does this not apply in reverse?

Dennis Burling
Proprietor,
DPI Financial Services,
Bristol

Recommended

Swallow the humbug

It’s time to seize back the pension agenda from the Government

Sunny for shares

In my next two articles, I intend to look at the future prospects for equities. My aim is to arrive at a justifiable projection of likely medium and long-term rates of return.

‘Supermart headline rates do not match risk profiles’

Specialist intermediary Terrablu is accusing supermarkets of offering headline rates that do not match the risk profile of a typical supermarket customer. The firm – an introducer business to IFAs Directly Financial and Griffiths McAlister – says if customers want to benefit from supermarkets’ headline-grabbing rates, they must be archetypal “ideal” consumers, being fit, healthy […]

A leap of faith

The sins of commission have unfairly earned a bad name for IFAs and may have deterred consumers from seeking their advice

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com