Act now on mis-sold endowments: new article

DAVE1003

mayb wrote: »

My own personal experience with the CIS would lead me to doubt what was being said here - if you haven't had any reports on a year on year basis to tell you what has been hapening with your endowment then that in itself is a cause for concern. If are you saying that you already know that it has performed well for the last 20 years because of the information you have received that is a different matter of course.

At the time I cashed in my own endowment with them the CIS were not paying final bonuses at all and that was certainly within your 20 year period. Of course there are different funds for different investments but the CIS spent a lot of money when they finally modernised their business and stopped sending agents out to collect your money and your business.

The insurance arm of the CIS was originally to have merged with the rest of the business if I remember rightly and this move was delayed - someone may be able to enlighten us as to whether that ever went ahead.

I had a very bad experience in dealing with this company when seeking redress for a very missold policy I had with them. Lying and cheating their way through the process and rewriting history, as well as withdrawing information from their website that the fund had been closed after I complained to the FSA that we had not been informed of the fact at the time. A closed fund is not likely to make any money.

It was a former agent of the company who warned us to look into our policy and how it was performing. He was leaving as he was upset at the way the company was behaving towards its customers and did not feel happy about dealing with customers in a way he felt was misleading them.

I agree with dunstonh that you should seek totally independent advice on this. However, I do not think the market has bottomed out - and would wonder how anyone could think that we know what the bottom is likely to be when the recession has barely started.

i have had reports about my endowment & it has been well in excess of the amount i owe on my mortgage every year that is until my last one in june.
my problem is if i got rid of it, I only pay £16.50 per month & i'm sure a life policy to cover my mortgage would be over a fiver. So for about a tenner anywhere else i don't think i would be any better off.

mayb_2

Like a lot of these things at this moment in time it is almost impossible to predict the final outcome. However, as I understand it the final value will be at the time of its 'cashing in' and past performance will not necessarily help you much if the market is at a low point when you need it. Have you actually asked how much you would get if you cashed it in now? Will there be a smoothing off of the profits and losses to even these out or will there definately be a bonus pay out at the end if you keep it going? If they could take a decision to cancel these one year they could certainly do it again. Have you any real assurance that you will receive one of these?

I still think you should speak to an independent advisor as you have nothing to lose on taking advice - you can still stick with your original plan. We had free advice from our Building Society - we had to see their own advisor and then they also supplied us with an independent advisor too. He did not recommend any of the building societies products so definately independent.

It is possible to cash in an endowment policy and keep the mortgage/life protection cover going. I did this some years ago and the rate I pay has never changed.

I hope this works out well for you whatever you decide to do dave.

DAVE1003

mayb wrote: »

Like a lot of these things at this moment in time it is almost impossible to predict the final outcome. However, as I understand it the final value will be at the time of its 'cashing in' and past performance will not necessarily help you much if the market is at a low point when you need it. Have you actually asked how much you would get if you cashed it in now? Will there be a smoothing off of the profits and losses to even these out or will there definately be a bonus pay out at the end if you keep it going? If they could take a decision to cancel these one year they could certainly do it again. Have you any real assurance that you will receive one of these?

I still think you should speak to an independent advisor as you have nothing to lose on taking advice - you can still stick with your original plan. We had free advice from our Building Society - we had to see their own advisor and then they also supplied us with an independent advisor too. He did not recommend any of the building societies products so definately independent.

It is possible to cash in an endowment policy and keep the mortgage/life protection cover going. I did this some years ago and the rate I pay has never changed.

I hope this works out well for you whatever you decide to do dave.

THANKS ,
i'll try and look for a local advisor, the amount i could cash it in for now is £8440. At the 4% final valuation i'm about level with what i owe (the amount i borrowed was £10500 but i owe about £10000 now so that level seems more realistic than the 5.75% & the 4% level is on completion £9990.

treliac

mayb wrote: »

I had a very bad experience ........ when seeking redress for a very missold policy I had with them. Lying and cheating their way through the process and rewriting history ........

A not unusual experience when dealing with these things. Echoes my own!

RobCheshire

Rather stupidly I was six weeks after the time limit when I made my complaint, this was a couple of years ago. It took ages (over a year) for the Ombudsman service to write to me telling me they were not allowed to take up my complaint as I was too late. However they did keep me informed of the delay in dealing with my letter by regular communication.

Is it really the end of the line for me? The lateness was for a variety of reasons, but I accept that it was my fault. It seems ridiculous that a period of six weeks over a twenty year term should allow them to get off scot free.

It's even more galling that the Standard Life policy was sold to me by a 'friend' employed by a building society, who has since had a fat redundancy pay off. He openly admits that selling these policies was very lucrative for him at the time. The BS, by the way, has recently been taken over by Santander...

I have one year to go, and will have to find around £6000.

Anyone got any ideas??

Thanks

Rob

dunstonh

Is it really the end of the line for me?

Yes. The time bar is only overuled if you have good grounds.

It seems ridiculous that a period of six weeks over a twenty year term should allow them to get off scot free.

Its not six weeks though. Its 3 years from first being notified of a high risk of shortfall followed up with warnings that the window to claim is closing and the date it closes.

I have one year to go, and will have to find around £6000.

You are around 8 years of knowing that there is a shortfall likely. Its not a great idea to leave it to last minute.

It's even more galling that the Standard Life policy was sold to me by a 'friend' employed by a building society, who has since had a fat redundancy pay off.

Good luck to him. You have to remember that the consumers association (Which?) were recommending endowments as the best option when you took yours out. Indeed, they used to promote Standard Life as the best buy. The media used to promote endowments as well. This site would have been promoting endowments and providers as well had it been around then. Its easy to look back with hindsight.

In reality, you are not that bad off. You were probably saving around £15pm (typical average) over a repayment mortgage. Thats £4500 over 25 years meaning a £6000 shortfall only sees you around £1500 worse off. Plus, the causes that have made endowments fail have made people richer overall.

jlaw1

Endowments
I actually cashed in my endowment policy about 2+ years ago and would like to know if I would still be able to look into finding out if the policy was mis-sold. Also how would I go about it as I wouldn't have any documents any more and I do remember that during my policy it switched from one company to the other and I can't remember any of the forcasts being enough to pay off the mortgage it was taken out for.
Looking forward to any appropriate advice.

Thanks
jlaw1

dunstonh

would like to know if I would still be able to look into finding out if the policy was mis-sold.

Either you believe it was or it wasnt. If you believe it was and you are not timebarred then you can still complain. The time bar is three years from first being notified of a high risk of shortfall. Around 3/4 of endowments are now unable to complain on. So, if before you surrendered, you had been notified of that high risk of shortfall then the time bar clock had started ticking.

DAVE1003

dunstonh wrote: »

Yes. The time bar is only overuled if you have good grounds.



Its not six weeks though. Its 3 years from first being notified of a high risk of shortfall followed up with warnings that the window to claim is closing and the date it closes.



You are around 8 years of knowing that there is a shortfall likely. Its not a great idea to leave it to last minute.



Good luck to him. You have to remember that the consumers association (Which?) were recommending endowments as the best option when you took yours out. Indeed, they used to promote Standard Life as the best buy. The media used to promote endowments as well. This site would have been promoting endowments and providers as well had it been around then. Its easy to look back with hindsight.

In reality, you are not that bad off. You were probably saving around £15pm (typical average) over a repayment mortgage. Thats £4500 over 25 years meaning a £6000 shortfall only sees you around £1500 worse off. Plus, the causes that have made endowments fail have made people richer overall.

hi mate,
what would you do if you were me ,
my endowment has been on track for the last 22 years up until une last year when it dipped for the first time.
I owe just under £10,000 on my mortgage my surrender value at the moment is £8440 & i have about 2 1/2years left to run. i have just got a report & it is at 4% a value of £9990 on completion where as a year ago it was £1000 more. i am undecided what to do i was going to wait then i was going to wait till june when my next report is due now i am wondering if to cash it in & at least then i know what i need to add to it in the next 2 1/2 years.
Cheer's

mayb_2

Hi Rob - unfortunately the time bar is sanctioned by the FSA and there is nothing you dan do unless SL failed to give you correct warnings. They are required to let you know in writing when there are only 6 months left for you to claim and the date of the cut off. If that has not been done you should appeal.

Nothing about this system is designed to support the claiment - it is a get out of jail free card for those who miss sold these policies.

Dunstonh the idea that you should feel better off when you are left with large sums of money to find at the end of a mortgage term is a nonsense. In the end the question is not was this product considered a good one to buy at the time but was it made very clear that it might not be such a good one by the end of term. In other words was it missold - did you understand the risks when you bought it. As it would appear the sales forces did not understand the risk, it is unlikely they would have explained it. Rather these were sold as a sure fire thing for all the reasons you described. In the later years many of these were sold after it had become clear that they would not pay off the mortgages they were being sold to cover let alone produce a lump sum. They did, however, still produce lucrative commission for the person selling them.

The other point being, no matter what your money can buy you in a recession, the amount of mortgage owed does not alter according to the interest rates or buying power available at the time. Ihe amount is £6000 you are not going to be able to 'buy it' for less during a recession. If you also happen to be a victim of the recession and lose your job - then what?