Refundable – unregulated life insurance with “unique” premium refund?

Refundable logo

Refundable Limited offers two life insurance products:

  • £3,000 Accidental Death for a 10 year term for £25 per month
  • £10,000 Employed Life for a 10 year term for £25 per month

The premiums and sum assured are fixed. The Employed Life policy has more restrictive eligibility criteria, hence the higher sum assured and not being restricted to accidental deaths only. The Accidental Death policy is open to anyone aged over 18.

Refundable promises to refund the entire £3,000 total premiums paid at the end of the 10 year term, which it describes as “unique”.

The company is currently promoted via unsolicited emails (i.e. spam) and via an affiliate programme which promises to pay “£69 and £115 commission on all sales you generate each month” for websites which link to Refundable.

Who are Refundable?

No details of Refundable’s management are provided on the website.

Originally Refundable was incorporated in September 2016 by its founders Lee Plaister and David Brennan. Plaister left as director in October 2017, but then returned in November 2019 when Brennan left the company. Plaister is now the sole owner and director.

David Brennan also runs a company called The Tax Repayment Agency, which has been the subject of numerous negative reviews from consumers claiming they were duped into using the agency to make tax refund claims, and never saw the tax refund. The Tax Repayment Agency Ltd is currently due to be struck off by Companies House for failure to file accounts and details of its ownership.

As for Plaister, not much about him appears on the web other than some local news stories relating to a planning dispute and a £200,000 loan his other business Beyond Comparison scored from a Government investment fund.

How safe is the insurance?

Effecting contracts of insurance in the UK requires authorisation from the Financial Conduct Authority.

Refundable’s T&Cs are upfront about the fact they are not regulated by the FCA and there is no mention of any regulated insurer they use for their contracts. This means that Refundable are operating illegally.

The illegality of Refundable’s contracts isn’t even the most fundamental problem.

The last accounts for Refundable (September 2018) show no assets other than a nominal £100. If even a handful of Refundable’s clients die and claim on their policies, how is it going to find the money to repay everyone’s premiums back at the end of the term, while funding its running costs and the commission it pays to affiliates?

As an unregulated business, Refundable is not covered by the Financial Services Compensation Scheme. This means that if it goes bust, its policyholders are almost certain to have lost any premiums paid to date, and any unfortunate enough to die aren’t going to get their claims paid either.

Should I take out life insurance with Refundable?

Effectively anyone who pays premiums to Refundable is not buying insurance, but lending their money to a small business operating illegally, for nothing in exchange but the hope that Refundable will somehow find £10,000 from somewhere (or £3,000 for the Accidental Death policy) for their loved ones in the event of their death.

If you want to protect your loved ones in the event of your death, lending money to a small obscure business operating illegally is a lousy way to go about it.

If you want life insurance, it’s best to forget the “we’ll refund your premiums (if we’re still around in 10 years) gimmick and just go with a conventional life insurer.

£25 per month in premiums for a 40 year old will currently buy around £300,000 in life insurance for a 20 year term if they are in good health.

And if at the end of the term you would be whinging about not getting your premiums back, i.e. whinging about the fact you didn’t die, life insurance really isn’t for you. Nor frankly is money.

4 thoughts on “Refundable – unregulated life insurance with “unique” premium refund?

  1. Dave Brennan, the guy behind this, is a Clown. He’s got his dad on the ticket of a purported “Discretionary Fund Manager” called BB Capital Management. I’ve never seen a one-man band before. Didn’t think the FCA allowed it. This will inevitably not work out as advertised. Good find.

    Like

  2. I find this an odd one. If it is a scam why the low sum assured? In theory I think it is a viable business model. Let’s assume they are taking out the policy with a properly regulated insurer instead of doing it themselves (even though nothing on their web site says they are). That means they have no need to pay out themselves if the client dies. A £3000 sum insured would cost a pittance, maybe 25p per month. So each month they make a £24.75 profit which they invest. It wouldn’t be very hard to make enough profit with that money to pay back the client at the end of the term and have some money left over for themselves.

    I’m not saying that’s how it’s done just that it could be viable. However even it was was all above board that’s not to say you should go for it. It would be far better to take out separate life insurance and investments of your own.

    Like

  3. We would love to get in touch with you regarding your ‘review’ of Refundable. Unfortunately we cannot find any contact details for you. If you would like to discuss the legalities of our Employed Life plan then please get in touch with us at support@refundable.co.uk and hopefully we can explain in full how our plan works and as such how we are not operating illegally.

    In brief

    Employed Life and Accidental Death plans are part of a group membership scheme backed by another provider. Group membership schemes are not, and cannot be covered, by the FCA and therefore it is not possible for Refundable to be FCA regulated (or backed up by the FSCS). We are aware that this may not offer the comfort that some potential members may wish for, and we are trying our best to add reassurance to our members and more details of this will be on our website in the coming days.

    As ‘Fraid Knot’ has posted in a previous comment, there are ways to ensure this is a very viable business model and we can assure you that it is, and is operating perfectly above board. We do not offer any advice and as such wouldn’t like to begin to suggest if our plans were suitable for an individual or not, however we are sure that there is a place for this Refundable plan and hopefully the owners of this site would like to get in touch so we can assure them that we are operating perfectly legally.

    Like

  4. There is a Contact link right there at the top of every page.

    Reviews are based on the information made available to the public and there is no mention of this other provider and their identity in Refundable’s literature at the time of this review.

    Even if offering unregulated insurance contracts to the public is, in fact, legal, that doesn’t change the fact that the risk of Refundable running out of money and being unable to honour claims or rebates at the end of the term makes it unsuitable for the vast majority of people trying to protect their families.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s