Act now on mis-sold endowments: new article

efunc

Regarding whether or not I could qualify for compensation:

dunstonh wrote: »

However, on to the "yes", you didnt have a mortgage and were not buying at the time so a sale of a mortgage endowment is not suitable. These pre-sale endowment sales nearly always get classed as upheld complaints (although in more recent times certain groups, such as armed forces, have found decisions go against them as pre-sale endowments were technically a suitable product).

However, since my policy began in Jan 1987:

dunstonh wrote: »

Options are limited.

If the company do not voluntarily agree to review the case then its game over. The FOS wont look at it unless the company agree. The FSCS wont touch it and the FSA dont handle consumer complaints. None of the "F"s will be any use to you.

dunstonh, thanks very much for all your advice. I have some time this week so I intend to start the ball rolling. Given that my policy began in 1987 and I can't appeal to the FSCS I'm guessing I need to write directly to ManuLife? Is there any kind of guide to this or a template letter, or things I should include and a writing style or anything? I'm quite inexperienced in this matter! Given I could jeopardise my case is it generally more advisable to hire a third party to take the case on my behalf (even if they are to take 10%, say)?

efunc

essaj wrote: »

I've looked at the Which? site to draft a complaint letter as my advisor sold the plans to me on the basis of not only paying off the mortgage, but they would also give me a large lump sum........sounds familar doesn't it!!

essaj, do you have a link to this letter? are there any other non-FSCS resources anyone can point me to? thanks

dunstonh

We have never tried to claim for our endowment as we were aware of the risks involved, however, we have just discovered that we are not covered for critical illness, just basic life assurance, with the policy. We were sold it on the basis that we both thought we had critical illness cover - does anyone know if we would have a claim on this basis?

Did the provider offer CI on their endowment policy at point of sale?

To be honest, I have never heard anyone with a similar complaint. I doubt it would be successful to be honest unless the illustration and reason why letter stated you included CI cover. If they do, then you have a strong case. If they dont then you do not.

---

Given that my policy began in 1987 and I can't appeal to the FSCS I'm guessing I need to write directly to ManuLife?

Only if it was sold by an agent or employee of Manulife. If it wasnt then its end of the road.

Is there any kind of guide to this or a template letter, or things I should include and a writing style or anything?

There is one on this site somewhere.

I'm quite inexperienced in this matter! Given I could jeopardise my case is it generally more advisable to hire a third party to take the case on my behalf (even if they are to take 10%, say)?

Claims companies, as a collective, actually have a lower success rate statistically than personal complaints (Although template letters would account for that as many claims companies just use a template letter). Personal letters seem to be the best approach. There is actually very little that needs to be written. It doesnt have to be pages and it only needs to be a couple of lines. Just state why you think it was mis-sold. Dont waffle on, dont complicate it and dont make things up or add things which can be easily found to be incorrect. A common mistake is for people to include things on letters that are not true and easily proven otherwise and if a balance of probability decision needs to be made, if you have found to tell porkies or at least include information that is not accurate, then that could work against you if the other party has only shown factual information that is proven.

efunc

great advice. i'll just crack on then and see what transpires.

mayb_2

On the other hand dunstonh I found that companies can tell porkies that are easily proven to be untrue and nobody takes any notice - I know this has happened to others too. It is not all one way traffic but you don't need to tell anything but the truth if you are missold as if it is not on your paperwork then it didn't happen. The balance of probabilities means that if there is nothing on your paperwork to show that a risk assessment was done for instance, then it wasn't done. So stick to how it was, even if they don't have to.

diesel_doglet

Hi all,

Firstly, thank you for taking the time to read this post. I very much appreciate it.

Secondly, appologies if these questions have been asked before. I have read through many pages of this thread but there are just soooo many!

My parently currently have 4 endowment morgages (due to moving and purchasing larger houses in late 80's early 90's. The endowments were there to cover £30K but there is going to be a total shortfall of approx £10K. All of the endowments are assosiated with morgage(s) from the Halifax bank.

My parents have written the letter to the ombudsman and they have received compensation for just over £2.5K from the insurance company who halifax used to supply the endowments.

My father is now wondering if he can request compensation directly from Halifax for the mis-selling or is the fact he has settled with the insurance company mean that he will be unable to request compensation from Halifax?

Any thoughts or points will be very much appreciated.

thanks again,

Steve

pamelamothershaw

I wonder if any one can help on this.
My friend took out what she thought to be an endowment policy
with her mortgage in approx 1987. It has just come to light that
it wasnt an endowment at all, but a life policy. Which she would
never have needed as her husband in a policeman and is well
covered life wise. She has had the shock of her life finding out
that her £169,000 mortgage is not going to be paid off in 3 years
and she has been paying nearly £200 a month for a life policy all
these years. Can she make a claim as having this mis-sold. The
financial advisor is still working, but the company he was working for
at the time has gone bust. The best advise they have had is now
a 12 year repayment mortgage, taking her Husband to 70 at £1650
per month !!.
Would be grateful for any advise here.

dunstonh

Which she would never have needed as her husband in a policeman and is well covered life wise.

I think you will find that the life protection offered by the police is not as good as you think. My mortgage adviser reviewed a police officer's death in service and life cover arrangements and there were restrictions to the amount paid as for once a good chunk of it actually meant death in service.

Can she make a claim as having this mis-sold.

On the grounds of having a life policy, no. Death in service is allowed to be excluded as there are too many clauses, it tends to get changed and there is no guarantee the proceeds will be available to repay the lender. Plus, its key aim is for family protection and 2 to 4 times salary doesnt tend to go very far, especially if you use it to clear debts.

Also, its pre-regulation so there is no complaints process unless it was sold by an agent of the insurer (which you say it isnt). Even if it was post regulation, I think there would have to evidence to show that an endowment was expected. With no evidence, it would be a balance of probabilities decision by the FOS and there are some points that would need clarification:
1 - was the mortgage for £169,000 when first taken out in 1987 or were there further advances? (average house price in 87 ranged from £28k (north) to 80k (london)back then (Essex was £60,525). So a mortgage of £169,009 is very large for the era.
2 - why was there never any query regarding value of the endowment?
3 - why didnt the lender query the lack of endowment (in 87 most lenders still wanted the policy to be assigned to them and they still inspected the policy docs to make sure it met criteria)?
4 - what is the IQ of the police officer? now that doesnt mean to sound as rude as it looks but there is an expectation that someone that is capable of having earnings to cover a £169k mortgage in 1987 when the average wage for a man was £11,648 should have a bit of common sense and knowledge. A £169k mortgage back then would have needed an income around £56,300 a year. 5 times more than the average. That would make him a very senior police officer as the same income now would be closer to £200k.

I suspect your friend isnt giving you the full story to be honest as there are inconsistencies.

I should also say that I have come across two individuals in the past who were exactly in the same position and I put complaints in on their behalf and both got rejected by the advising firms. It came to light that they were able to show that endowments were recommended but the husbands decided to go with life cover only and switch to endowment later. Neither had changed it as they kept putting it off and in the end couldnt afford it and neither had told their wives and never told me until they were in private and I told them the findings. I have relayed that story to other advisers who have also experienced that. Remember that 1987 was one year before the house price crash and people were pushing their budgets then just as they did a few years ago.

pamelamothershaw

Thankyou for your advise. You are right when you say there were several further advances. From memory the house was purchased in 1987 for £65,000. At the time he was a constable. I was indeed myself surprised by what she told me as I would have expected a yearly statement normally on an endowments performance. Why the building society didnt insist on an endowment being assigned to them I cant answer, but will certainly ask the question.
Thankyou so much for taking the time and trouble to reply.

dunstonh

You are right when you say there were several further advances.

Yes, i guessed as much as the figures seemed to high for the time.

Thats going to be a problem, although it could also benefit them, as it effectively means that every time they borrowed money, assuming they sought advice each and every time, why were they not giving updates of an endowment and have one taken out for each increment (we now know there wasnt one but did that not ring alarm bells?). Or why were they not told each time they didnt have an endowment and should take one out?

One possible reason could be if the person they used was not a financial advice but a mortgage adviser. Mortgage advisers cannot arrange investment products so couldnt arrange one even if they wanted to. Although they do need to warn that one should be effected and without it there will be no means to repay the mortgage.

With multiple further advances, it just seems unlikely that each time the subject of endowment or mortgage repayment never came up.