Cash for victims of Zurich life cover bungle

THOUSANDS of Zurich life insurance customers are owed up to £20,000 in compensation after being overcharged for years. The insurer is writing to around 2,000 people who bought policies between 2001 and 2003 — after realising it had made an error in calculating premiums.

One customer received a letter and a cheque for around £20,300 for a policy he had stopped paying for in December 2013. Zurich says it looks at the number of policyholders who have died and whose families have claimed on their policy to see if it is putting aside enough money to cover future payouts and still make a profit.

If more die than expected, it will increase premiums to cover the costs or lower the maximum payout they can claim.

Zurich says it made a mistake in the way these policies were set up, leading to miscalculations further down the line and some policyholders paying over the odds.

It’s now repaying the excess charges, plus interest. A spokeswoman says: ‘We’re sorry for the hassle we have caused to our customers, but hope our swift actions to rectify the problem and repay what they are owed has showed how committed we are to doing the right thing.’