[Coopaloop]

Hi All,
Not sure if Im posting in the right section, so if not sorry!

About 3 or so years ago myself and my boyfriend went about buying a house, our mortagage broker got all things sorted for us on the house, house insurance, life assurance etc...anyway the house fell through at the last minute (thank god) but the mortage broker said sure keep the life assurance policy in place and you can apply it to another house when you get one. I didnt really think much about it after that, totally forgot about it.
Then 2 years ago we did buy a house and took out a new life assurance policy and I forgot about the one that we had out, stupid I know but I didnt notice the money coming out of my account as I dont really check that often, so I started thinking about it one day and thought there is no point in having this is place as we have a new one relevant to our new house (different location, different size house) and sent the insurance company a letter to cancel the policy and ask for a return premium as there was no insurable interest in the house and they sent back a letter saying that they could not refund premium because if there was a claim (like one of us died or something the policy would be in force) but I wondered how that was possible as the point of the insurace was to cover mortage payments should a partner die etc.. so I sent a letter back statng that since we did not buy the house there was no insurable interest, they got back to me saying as a gesture of good will they would refund me one month. This was a while ago now and I just accepted it, however I read something today that got me thinking about it again and wonder if this is correct or if there is actually something I can do to get my money back (around €1,000 over a year or so).
I realise I have been stupid by not stopping the policy when the first house fell through.

This is a really long post....sorry!

Any help would be great!

Thanks a million.

[Delancey]

I think the insurance company are actually being pretty nice offering you a months premium refunded - you haven't a leg to stand on - you allowed the policy to remain in force and had either of you died then there would have been a claim on the policy which they would have had to pay out on .
They carried the risk and are entitled to charge the appropriate premiums. That the house purchase fell through does not matter in the slightest , the policy was still valid and open to being claimed on.

Imagine you had your car insured and never claimed on the insurance policy and then after a couple of years got rid of the car would you ask for your premiums to be refunded ? Of course you wouldn't - same thing here.

[jblack]

If the insurable interest was specifically against mortgage payments and you had no mortgage, then there is no contract of insurance and you are entitled to any premium paid against a non existing insurance contract by restitution.

If there was an insurable interest then the policy is valid.

[ResearchWill]

Originally Posted by jblack

If the insurable interest was specifically against mortgage payments and you had no mortgage, then there is no contract of insurance and you are entitled to any premium paid against a non existing insurance contract by restitution.

If there was an insurable interest then the policy is valid.

If you read the op they where advised to keep the "life insurance" such insurance even if the house was not bought or sold, is still valid as it pays out on the death, if either of the parties had died during the 3 years the policy would have paid out.

[jblack]

Originally Posted by ResearchWill

If you read the op they where advised to keep the "life insurance" such insurance even if the house was not bought or sold, is still valid as it pays out on the death, if either of the parties had died during the 3 years the policy would have paid out.

Yep, lazy reading on my part.

[Coopaloop]

Thanks for the replies. The mortgage broker told us to keep it in place so that when we did buy a house we could apply the insurance to it, but there was no insurable interest for over a year and a half, and we did not apply it to our new house.

I was later told that we would not have been able to do this anyway as the insurance was rated on a altogether different property and location so we would have needed to get a new quote anyway as the risk was different.

The life assurance policy was on the house and mortgage repayments, so if one of us dies the mortgage would be paid off, because the house and mortgage was never got I thought that I would be due a return premium.

The mortgage broker didnt really know what he was talking about, but hey, you live and learn.

Thanks again.

[ResearchWill]

But in a life policy you are the insurable interest. The policy would have paid out to your estate if you died and would not have paid off a house as no house was bought. If the policy had been buildings insurance then the house would have been the insurable interest.

The broker gave you good advice, if you where thinking of buying a house very soon afterwards as the life insurance was in place saving time etc.

If the same broker arranged the second property and insurance then you should go back to him and he should refund the money.

[Coopaloop]

Ok thanks, I understand what you are saying, but the only reason we took out the policy was because we were buying a house. I know from speaking to someone in a claims department that an insurance company would have tried their best to avoid and decline any claim on the policy as there was no house applying to the policy.

Nah learnt my lesson using that insurance broker, so would not use him second time around, did it myself instead, the broker didnt give us good advise at all, like I said, we would not have been able to use the existing life assurance policy on the new house.

[ResearchWill]

I'm really not understanding what you are being told in relation to not using your policy on the second house. The policy is a life policy you can have any life policy to cover the banks interest in the property. I think in fact the person who told you you could not use the first policy was incorrect. Banks try this all the time so much so I think it will be a big issue in the future as in my opinion it's akin to mis selling.

Can I ask was it your bank who told you this?

[Coopaloop]

Yeah thats true, I think you could be right!

No it was an insurance company who told me.

Ive been told a few different things about this, so not sure which is correct.

Thanks for your help with this

[ResearchWill]

Originally Posted by Coopaloop

Yeah thats true, I think you could be right!

No it was an insurance company who told me.

Ive been told a few different things about this, so not sure which is correct.

Thanks for your help with this

Which insurance company the first one the second one or a different one alltogether.

[Coopaloop]

Originally Posted by ResearchWill

Which insurance company the first one the second one or a different one alltogether.

The insurance company I am with now and have the life assurance policy with. I told them that I had a policy in place (when I realised that i had the other one) and they told me that. I thought I could cancel the current one and use the existing one.

[ResearchWill]

Originally Posted by Coopaloop

The insurance company I am with now and have the life assurance policy with. I told them that I had a policy in place (when I realised that i had the other one) and they told me that. I thought I could cancel the current one and use the existing one.

All I would say is of course they would say that.

[Delancey]

Originally Posted by ResearchWill

All I would say is of course they would say that.

They will tell you anything for a commission - I used work for a Life Assurance Company and I still get a buzz out of showing up bank staff just how little they know when it comes to trying to flog me something.