Not upheld: Investment mis-selling complaint against Phoenix Life CA Limited

Decision detail

Summary

Mr and Mrs B complained about a reviewable whole of life insurance policy held since the early 1990s that failed review in 2025, requiring either a premium increase from £30 to £220.30 monthly or a reduction in sum assured from £20,000 to £9,270. They also complained about delayed reviews between 2022-2024 and insufficient time to respond to the 2025 review. Phoenix acknowledged service failures and offered £200 compensation plus policy adjustments, but maintained the 2025 review outcome was correct. The ombudsman found Phoenix had failed to provide sufficient information about charges and future premium requirements, but concluded that Mr and Mrs B would not have taken a different course of action because they had received repeated warnings over more than a decade that the policy would not last indefinitely and changes would be required, yet had not responded to these warnings. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman acknowledged Phoenix's failures in communication and missed reviews but concluded that redress was not warranted because: (1) Mr and Mrs B were repeatedly warned over more than a decade that the policy would not last indefinitely and that changes would be required; (2) despite receiving clear warnings that the policy would only last 2-3 years by 2020, they took no action; (3) based on their actual response to information provided, it was unlikely they would have acted differently with more information; (4) the balance of probabilities suggested they would have kept the policy in place rather than surrendering it; (5) the policy retained a minimum sum assured of £9,270, providing some cover at the maintained premium of £30.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website