The Mail on Sunday

Phoenix won’t let us surrender our life policy

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J.M. writes: We contacted Phoenix Life to surrender a life policy. We were quoted a value of £16,000plus, so we signed the surrender forms and cancelled our premiums. When we heard nothing, we telephoned Phoenix and were told our policy included an investment in a property fund that was suspended, and we would hear more in 28 days. Phoenix then complained that we had stopped paying premiums.

YOUR policy contained a spread of investment­s, and when you complained, Phoenix offered to pay the surrender value, less £115. This was the value of units in a property fund which was suspended last March, so your £16,000-plus payout had ground to a halt for the sake of £115. Property funds are notoriousl­y illiquid. It is easy to sell stocks and shares for cash, but you cannot easily sell a slice of an office block to raise cash for an investor.

Phoenix had cash on hand to pay investors whose policies were maturing, but not for policies voluntaril­y surrendere­d. However, common sense has won. Phoenix told me: ‘Given the minimal fund value invested in the property fund, we will make an exception.’

By the time you read this, the full £16,273 will be in your bank account.

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