Upheld: irresponsible administration of reviewable whole of life assurance policies; failure to provide clear information; poor communications and record-keeping complaint against Phoenix Life Limited
Financial Ombudsman decision DRN-4283989 of 2026-04-08T00:00:00+00:00. irresponsible administration of reviewable whole of life assurance policies; failure to provide clear information; poor communications and record-keeping complaint against Phoenix Life Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-4283989 |
|---|---|
| Decision date | 2026-04-08T00:00:00+00:00 |
| Firm | Phoenix Life Limited |
| Product | Life / income protection |
| Claim type | irresponsible administration of reviewable whole of life assurance policies; failure to provide clear information; poor communications and record-keeping |
| Outcome | Upheld |
| Remedy | Phoenix must reconstruct Mrs H's policies based on her accepting the proposed premium increases at each review since the tipping point (approximately 2008). Mrs H is not required to repay historic premium deficits. Phoenix must make a contribution to clear the deficit, which will be added to the policy's investment fund. Phoenix may deduct the deficit from the sum assured in the event of a claim or from the surrender value if the policy is surrendered before a claim. Phoenix must also pay £350 compensation for inconvenience caused by service failures relating to address, name updates, and call centre wait times. |
Summary
Mrs H held four RWOL policies administered by Phoenix. Phoenix used an incorrect address for Mrs H, preventing her from receiving policy review letters that required her to either accept premium increases or accept benefit reductions. When Mrs H did not respond to letters she never received, her benefits were automatically reduced. Additionally, Phoenix made repeated errors when updating Mrs H's surname following her marriage. The ombudsman found that Phoenix's review letters lacked sufficient information about the cost of cover and policy sustainability projections required to enable informed decision-making. The ombudsman concluded that had Phoenix sent clear information to the correct address, Mrs H would have accepted the premium increases, which she stated were affordable. Phoenix must reconstruct the policies based on accepted premium increases and pay £350 compensation.
The Ombudsman's reasoning
The ombudsman found that Phoenix was responsible for using an incorrect address, which prevented Mrs H from receiving policy review letters. Had Phoenix sent clear, fair and not misleading information to the correct address, Mrs H would have understood the need for premium increases and would have accepted them, as she stated they were affordable and the increases tracked inflation. The review letters Phoenix sent did not meet regulatory requirements as they failed to explain the cost of cover or provide projections about policy sustainability. Phoenix also failed to correctly update Mrs H's surname on multiple attempts, causing unnecessary inconvenience. The ombudsman concluded that reconstructing the policy based on accepted premium increases, combined with £350 compensation, fairly puts Mrs H in the position she would have been in had Phoenix properly administered her policies.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Phoenix Life Limited, all decisions | 1,106 | 20% |
| Life / income protection, all decisions | 10,405 | 21% |
Source
Read the original decision on the Financial Ombudsman Service website