Act now on mis-sold endowments: new article

paulmc18

Thanks for that. I've got the 'pack' away somewhere so will hunt it out and look for the potential risks section. They didn't point out risks to me as such just that it would pay the 15K off at the end and I would even get a lump sum, not the other way! It was a drawdown facility as well if that sheds any light on the situation. I'm nor trying to 'con' the system, just need to be advised on what can be done.

Thanks for the reply anyhow! PMc

danlojo

Hallelujah.................. a FINAL DECISION has been reached by the Ombudsman in our favour.......:j

Endowment taken out in Mar 1992, due to expire 2017 with profits and life cover. Should have been gauranteed £50,000 at £60.50 per month. Shortfall now mahooosive, latest figures 3% = £22,600/ 5% = £26,800 if we are really lucky :@(

The decision is that Mandrake/Eagle Star will now work out for us the compensation ????

I guess the calculation is one that's always used:

Calculated payable compo based on D + E

A = refund of premiums paid from onset to the calculation date (date when the red letters arrived July 2003)

B = interest on each of the premiums in A fom the date each premium was paid to the calculation date

C = the surrender value of the endowment at the calculation date (confirmed by ES as being £7208)

D = A+B-C

E = interest on D from the date of calculation date to the date of this final decision (Oct 2008)

Interest is calculated at 8% simple per year(from 1 April 1993 and 15%per year simple before that date)

Any budding or professional mathematicians feel free to have a go at calculating.

I've attempted it and arrived at compo of around £2500?

Still totally gutted that companies can state that you pay such an amount and you will guarantee a said lump sum and that they change their minds and produce such a huge shortfall. Still a couple of thousand in my hands is better than in theirs!

dreamylittledream

Full refund of premiums to a calculation date suggests that this was either a non mortgage related endowment or you never used the policy to support a mortgage.

If so then the calculation method is correct.

As for checking the figures - you need a regular premium simple interest calculator (there are some online).

danlojo

Yes it is dreamy.

droopy

man i've dipped out here.

took out my endowment in Feb 87 through a supposedly independent adviser. it was supposed to pay off my mortgage of 38k and give me 25k lump sum. it is now looking like it is going to be between a 6K and10k shortfall on the mortgage. this may not sound much to some of you but i can assure you, it is an awful lot to me.

i thought that the money you gained, you kept and some years you may gain more than others. i had no idea you could actually lose value. what is really galling is that i could probably have saved almost as much by putting the money away each month.

with the original company, it seemed to be doing ok. then FP took it over and it's value in 2005 was only a few pounds more than in 2000. i put the losses bt 2000 and 2005 down to 9/11. whether this is right or not i don't know.

i can't claim because i took out the endowment before 1988 and it was through an independent adviser. still, to end on a positive note, i have my house and only a few years to go on the mortgage. i'll just need to take a second job (been reading up on that on here too!).

turbobob

droopy wrote: »

i can't claim because i took out the endowment before 1988 and it was through an independent adviser. still, to end on a positive note, i have my house and only a few years to go on the mortgage. i'll just need to take a second job (been reading up on that on here too!).

There's a few things you can do to deal with a shortfall, e.g. convert part of the mortgage to repayment. If you haven't done anything about this so far then you really should. Theres an FSA guide here for some of the options available - http://www.moneymadeclear.fsa.gov.uk/pdfs/mortgages_pay_off.pdf

ystalyfera

danlojo wrote: »

Hallelujah.................. a FINAL DECISION has been reached by the Ombudsman in our favour.......:j

Endowment taken out in Mar 1992, due to expire 2017 with profits and life cover. Should have been

gauranteed

£50,000 at £60.50 per month. Shortfall now mahooosive, latest figures 3% = £22,600/ 5% = £26,800 if we are really lucky :@(

The decision is that Mandrake/Eagle Star will now work out for us the compensation ????

I guess the calculation is one that's always used:

Calculated payable compo based on D + E

A = refund of premiums paid from onset to the calculation date (date when the red letters arrived July 2003)

B = interest on each of the premiums in A fom the date each premium was paid to the calculation date

C = the surrender value of the endowment at the calculation date (confirmed by ES as being £7208)

D = A+B-C

E = interest on D from the date of calculation date to the date of this final decision (Oct 2008)

Interest is calculated at 8% simple per year(from 1 April 1993 and 15%per year simple before that date)

Any budding or professional mathematicians feel free to have a go at calculating.

I've attempted it and arrived at compo of around £2500?

Still totally gutted that companies can state that you pay such an amount and you will guarantee a said lump sum and that they change their minds and produce such a huge shortfall. Still a couple of thousand in my hands is better than in theirs!

same boat as you Dan,was sold ours in 1995 though with the Bradford Bingley and he fed us the same bumff we'd get house paid off and £48,000 and the endowment is £70 a mth but last figs we had (before everything went boom) we would have had £10,000 after the house was paid off,
but we would have owed them just £250 which would'nt have been as some i suppose,now i dont know where we are.
So in the mean time we tied ourselves into a 4% rate with about 4 yrs left (which aint to bad considering the way things were going) and we convert part of the mortgage to repayment,which in 4 yrs are hoping to go repayment totaly and keep the endowment going.

Apetrie7

paulmc18 wrote: »

Hi,

Also, had Georgeson on saying I had unclaimed shares........linked to the standard life endowment.


Standard Life are contacting thousand of policyholders who are entitled to shared following the demutulisation in 2006, claim your entitlement this will have no effect on your endowment policy. Even if you have cashed your policy in you are still entitled to your shares!

AJB72

My wife has received £750 from the FSCS for an endowment policy she took out about 10 years ago, but at the end of the letter it states this could be liable to tax. Is it right that compensation can be taxed, and should be keep some of this money aside until next April?

dunstonh

AJB72 wrote: »

My wife has received £750 from the FSCS for an endowment policy she took out about 10 years ago, but at the end of the letter it states this could be liable to tax. Is it right that compensation can be taxed, and should be keep some of this money aside until next April?

If the redress payment includes interest then it is taxable. The tax year you declare it for is the one the redress is paid. You cannot pick and choose which tax year you want to use.