Amber alert on my endowment

jayp70

This is my first post so please be gentle!

I’ve just received a letter from Halifax whom my endowment is with stating that there will be a shortfall of about £5k on a £30k endowment. It classed it as an Amber Alert. Would there be any grounds for me to make a mis-selling complaint?

It has been running for 10 years now and when I took it out, I was assured that it wouldn’t just pay off the mortgage but I’d have about £17K surplus! I can’t see this happening!

Any thoughts?

dunstonh

Would there be any grounds for me to make a mis-selling complaint?

Depends on what you were told at the time and what documentation supports your claims or the advising company claims.

It has been running for 10 years now and when I took it out, I was assured that it wouldn’t just pay off the mortgage but I’d have about £17K surplus! I can’t see this happening!

Still possible. If its unit linked, and you are in correct funds, then it could easily still over perform what is required. It could just as easily underperform.

A projection is an example of what you may get back if x% p.a. average is achieved. It does not mean that you will get this rate. You could get more, you could get less.

A projection at 4% on an endowment requiring 7% to hit target is obviously going to show a shortfall. That endowment could be growing at 10% and over achieving but still showing a shortfall. Equally, it could be performing at 2% and the projection is still wrong. A projection is not projection of what you are likely to get. It is an example of what you may get if that rate is achieved.

If you have documentary evidence that you were told it would pay a surplus (absolute rather than potential) then you have grounds for complaint. If you have no documentary evidence to support that, then you can still complain. However, if the provider has documentary evidence that you were given examples of the various repayment methods and that you made an informed choice and were aware of the risk, then the complaint is unlikely to be upheld. It really comes down to what you can prove and what the advising company can and cannot prove.

Froggitt

jayp70 wrote:

I’ve just received a letter from Halifax whom my endowment is with stating that there will be a shortfall of about £5k on a £30k endowment. It classed it as an Amber Alert. Would there be any grounds for me to make a mis-selling complaint?

A shortfall in itself is not grounds for misselling.

jayp70 wrote:

when I took it out, I was assured that it wouldn’t just pay off the mortgage but I’d have about £17K surplus! I can’t see this happening!

This however is significant grounds for a misselling complaint. Do you have it in writing?

jayp70

Not sure if I still got the original documentation, but shouldn't the company who sold me the endowment have all the paperwork?

EdInvestor

Often they haven't - and if they can't show they followed the rules, they have to pay up.

FOSman

Post 1995 sale, there should have been a 'fact find' and a 'reason why letter'. If Halifax sold it to you then they are expected to be able to produce it. Halifax though are pretty good at keeping such documents.

If it was an IFA and they no longer have the file, then its all down whether the policy matched your circumstances at the time of sale.

Let us know how you get on.

jayp70

Sorry, but its been some time since my last post regarding this.

Well, I made the necessary complaints to Halifax who had sold me the original endowment a couple of months ago. They sent back a letter saying they will look into the complaint and write back to me.

A couple of weeks ago, they did write back and explained they are still looking into it. I haven’t heard anything else from them since. How long does it take for these types of matters to be resolved? Surely, if they had all the paperwork, they would know if my complaint would be upheld.

vinno65

Hi Jayp70,
might take a while these companies are rather busy at present. They have had rather a lot of complaints over the last few years!. Suggest you bite the bullet and hold on, if they are having trouble resolving your complaint there are certain time limits that apply whereby thay have to have completed their investigation or at least contacted you and explained why it is taking so long. I think it is 8 weeks for the complaint but if it goes over this time then they must write to you every 4 weeks to let you know whats happening. If you get fed up waiting you can refer it to the FOS but I would give the firm a chance to resolve it first as as I said they are quite busy at the moment!
regards Vinno

jayp70

Update on my endowment. I've received a letter from Halifax last week and according to them there was no mis-selling. Ho hum!

I wasn't confident that they would have upheld my complaint.

EdInvestor

You can take it on to the FOS if you like.

https://www.financial-ombudsman.org.uk

vinno65

Hi Jayp70
A bit more info would be helpful. Why exactly have they said there was no miss-selling. Was an endowment suitable for you at the time and have they shown that the risks inherent with endowments were explained to you?.They may be right but don't just take their word for it post what they ave said to you and maybe someone can help
regards Vinno