Not upheld: policy review outcome and premium increases on reviewable whole of life insurance complaint against ReAssure Limited

Decision detail

Summary

Mr and Mrs H complained about the outcome of a 2025 policy review on their reviewable whole of life insurance policy held since the early 1990s, which proposed increasing monthly premiums from £184.89 to £794.17 to maintain the sum assured of £1,894,844. They argued they had been told premiums would only increase in line with RPI and that the policy had been mismanaged. The ombudsman found that the policy terms explicitly permitted significant changes at formal reviews (distinct from annual indexation), and that lower investment growth and changed mortality rates, not mismanagement, necessitated the increases. ReAssure had provided sufficient information from April 2022 onwards, and the ombudsman noted that even in 2005, significant premium increases would have been needed to sustain the policy. The complaint was not upheld, and the £250 compensation already paid for delay was deemed fair.

The Ombudsman's reasoning

The ombudsman distinguished between annual indexation (limited to RPI increases) and formal policy reviews (which allow for significant changes to premiums and sum assured). The policy terms explicitly permitted ReAssure to propose changes at reviews. The ombudsman found that lower investment growth and changed mortality rates, both beyond ReAssure's control, necessitated the premium increases. ReAssure provided sufficient information to enable informed decision-making from April 2022 onwards. The ombudsman noted that even in 2005, significant premium increases would have been needed to sustain the policy for life, and Mr and Mrs H's failure to make changes earlier meant higher costs now.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website