Thousands of Stonebridge life insurance customers should consider getting cover elsewhere as the provider's axing its monthly renewable life protection product. You should also complain if you feel you were sold a lifetime policy.
The provider will continue to sell other life insurance products, but the move means those specifically with its monthly renewable life protection will be left uninsured in January 2016. See our Cheap Life Insurance guide for help finding alternative cover.
The accident and life insurance firm has this month written to nearly 4,000 customers to give them three months' notice that their cover will end. The exact end-date varies depending on which day of the month you took out your policy.
Stonebridge, which is part of the Aegon Group, says the decision follows a review of its life products completed in early September, which found that these "customers have benefited from a very generous level of cover to date" that it's unable to sustain.
The insurer says the move is not related to an £8.4 million fine it was ordered to pay by regulator the Financial Conduct Authority last year as a result of underhand selling tactics and the way it handled customer requests to cancel policies.
It adds that the rest of the business – it has around 350,000 customers with accident and health insurance products across the UK, Germany, Spain, Italy and France – continues to operate as normal.
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What does Stonebridge's monthly life protection cover?
Introduced in 2002, Stonebridge's monthly renewable life protection product costs £15/month for a single policyholder. In the event of the policyholder's death, beneficiaries receive a cash lump sum of £25,000.
The product offers cover on a monthly renewing basis, so when you pay, you're covered for the month ahead.
What happens to the premiums I've already paid?
Stonebridge says as this is a "simple life protection product" rather than an investment product, you won't get back any premiums you've already paid. However, you can continue to renew on a monthly basis and be covered by the product until January 2016.
If you think it's unfair that you were sold a policy on the premise that if you died there would be a payment of £25,000, and you've paid premiums into this policy based on this only to get nothing now, complain to Stonebridge. If you don't get a satisfactory response or it doesn't reply within eight weeks, escalate your complaint to the free Financial Ombudsman Service.
Can I cancel my policy?
The insurer says affected customers can cancel penalty-free at any time and they'll get a pro rata refund of that month's premiums.
What does Stonebridge say?
A Stonebridge spokesperson says: "Like any business we continually review our product range and adapt to the market conditions. The decision to no longer offer this product has no relation to the fine and is simply part of ongoing management of the business."