What is my legal position?

What is the nature of your amendment? Does it result in your paying lower premiums? How much lower?

1. Refuse to pay him anything, given that you have not cancelled.

1. Do not enter into any agreement to recommend friends to him - this would be likely to be enforceable, even if he had no case originally.

2. He is presumably regulated by the FSA. Threaten to report him to them.

"Andrew McGee" wrote

I'd say don't just threaten, *do it*!

Other future potential clients need to be protected too ...

To be enforceable would not "consideration" need to be involved? By this I mean would not the IFA need to offer something *in return* for the new requirement to recommend friends?

From the way his Terms are worded I don't think he could enforce a payment from you in these circumstances. There is no mention of a repayment of commission if the premiums go down, only if they stop altogether.

I doubt if the FSA, if you were to report this to them, would want to know. The question is more one of a legal agreement rather than of a regulated issue, although the FSA does require IFAs to be fair to their clients. What would a court of law say? I don't know, but I would guess it would be in your favour.

Rob Graham

By agreeing to it you would by implication be accepting his loss and agreeing to recommend friends in payment of it. Therefore the waiving of his lost commission would be the consideration.

IANAL,

Andy

I would say that if no commission is due then there is nothing that can be "waived" by way of consideration.

In message , Andrew McGee writes

Why threaten when he could just do it.

From the limited info we have, it looks like the IFA doesnt have a leg to stand on. The policy has not been cancelled, and premiums have not stopped.

Ultimately, it is up to the IFA whether to pursue their claim through the courts and, if they chose to do so, there is nothing the OP can do to stop them.

Personally, I think I would report them to the FSA, and suggest that the IFA does not have a claim, and that I would be quite happy to defend myself in court, letting a judge decide.

Due to changing circumstances (new job which offered these benefits) I lowered the life assurance and critical illness policy to about a 1/3 of what they originally were.

My problem with him was this - I consider the relationship with an IFA to be an ongoing thing built on trust. If my circumstances change and I do have to amend a "flexible" policy (and he gets some of the commission reclaimed) then he shouldn't have sold be a "flexible" policy in the first place. Also I would likely go on and do further business with him to enable him to get even more commission - something he seems to forget. Threatening people like this will not make me inclined to do more business with him and I certainly wouldn't recommend him to others.

People's circumstances DO change over time and to be honest 4 years is quite a long time. This has put me off buying through an IFA ever again, because I feel I can get much cheaper products directly and I don't have to worry about annoying IFAs demanding MY money!

I see. In that case it's debatable whether this amounts to a partial cancellation. But if, as you say, flexibility to do just that was built into the product from the outset, then I agree with the comments made by others that you should tell him to get on his bike -- unless it was made crystal clear in the contract (which apparently it wasn't) that exercising the option of flexibility to reduce cover (and thus premiums and thus his commission) would, for the purposes of this rule, be deemed equivalent to pro-rata cancellation.

Indeed. He should have been prepared for the size of his commission to be as flexible as the product itself.

Indeed. Tell him that with all the money you're now saving, you want to go and buy a stakeholder pension, and you would have bought it through him, but that by his attitude he's just blown his chances.

IANAL (and crap at anything financial...)

If he was an independant financial advisor, was he paid for the consultation in which he promoted this particular product ?

I`m just thinking there may be a conflict of interest - not only has he been paid for his "independant" advice, but he also wants to rake in commission on the product he sold.

I thought the point was that the IFA gets paid by commission but has terms which allow it to be reclaimed from the client if the product is cancelled. Independence has nothing to do with commission (unfortunately), it just means not being tied to a particular company.