Not upheld: inadequate information provision and communications regarding policy performance and costs complaint against Phoenix Life Limited (formerly Royal & Sun Alliance)
Financial Ombudsman decision DRN-6159448 of 2026-05-15T00:00:00+00:00. inadequate information provision and communications regarding policy performance and costs complaint against Phoenix Life Limited (formerly Royal & Sun Alliance). Outcome: Not upheld.
Decision detail
| Reference | DRN-6159448 |
|---|---|
| Decision date | 2026-05-15T00:00:00+00:00 |
| Firm | Phoenix Life Limited (formerly Royal & Sun Alliance) |
| Product | whole of life insurance policy |
| Claim type | inadequate information provision and communications regarding policy performance and costs |
| Outcome | Not upheld |
| Remedy | No additional remedy ordered. The £400 compensation already paid by Phoenix (£250 as a gesture of goodwill for the shock of the 2024 reduction and £150 for complaint handling delays) was deemed fair and reasonable. Phoenix confirmed it can backdate a supplementary policy if Mr N makes up missed premiums. |
Summary
Mr N complained that Phoenix Life significantly reduced his whole of life policy's sum assured from £142,400 to £51,172.65 in a 2024 review, despite all previous reviews from 1999-2019 confirming the policy was on track. He argued Phoenix failed to disclose that the policy was financially unsustainable from 2007 onwards and sent misleading communications assuring him the policy was performing well. The ombudsman found Phoenix did fail to provide clear information about rising costs and policy performance, but concluded that even with better information, Mr N would not have surrendered the policy earlier because he valued the family protection, had health issues making replacement cover costly, and did not respond to a 2019 warning by seeking changes. The complaint was not upheld, and the £400 compensation already paid was deemed fair and reasonable.
The Ombudsman's reasoning
The ombudsman found that Phoenix failed to provide Mr N with clear, fair and not misleading information about the policy's costs and performance, particularly after late 2007 when costs began exceeding premiums. However, the ombudsman applied a counterfactual analysis and concluded that even with better information, Mr N would not have made a different decision about the policy. The ombudsman reasoned that Mr N took out the policy for family protection, health problems made the protection increasingly important to him, he continued paying affordable premiums that maintained the original cover level, and he did not respond to the 2019 warning by seeking to surrender the policy. Therefore, the ombudsman found that better information would not have led Mr N to surrender the policy at an earlier point, and Phoenix was not required to provide additional remedy beyond the £400 compensation already paid.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Phoenix Life Limited (formerly Royal & Sun Alliance), all decisions | 1 | 0% |
Source
Read the original decision on the Financial Ombudsman Service website