Act now on mis-sold endowments: new article

magpiecottage

dunstonh wrote: »

Its like the person that complained for not being mis-sold as he now thinks he is missing out on a windfall.

All those IFAs who didn't missell to me can expect a complaint soon then.

mushyb

can anyone tell me if I can claim for a endownment policy I was sold without really understanding but that I no longer pay? i stopped paying but never recieved anything! Thanks

dunstonh

i stopped paying but never recieved anything!

That would suggest it lapsed without value in the early years. As endowments havent been on sale for a decade (last one was 2003) then it suggests it is quite a long time ago.

You have 3 years to complain from being reasonably aware of a problem or 6 years from the start. You havent said what your complaint is but chances are you are very time barred.

megcam

I have 3 endowment policies one of which i attempted to claim miss-selling on a couple of years ago without success, as i purchased it through a solicitors property centre and could not complain though the fsa!! I can quite clearly remember the conversation and the promise of a lump sum over and above clearing my mortgage.I have just joined this forum and my interest in compensation for miss-selling has been reignighted.
Any suggestions welcomed thankyou

dunstonh

as i purchased it through a solicitors property centre and could not complain though the fsa!!

Solicitors were rarely regulated by the FSA (or is predecessors). The FSA also does not consider consumer complaints. The FSA regulated complaints process only applies to FSA regulated firms (or predecessors).

I can quite clearly remember the conversation and the promise of a lump sum over and above clearing my mortgage.

Yet you cant prove that so it is disregarded in any complaint.

I have just joined this forum and my interest in compensation for miss-selling has been reignighted.

A bit late to the party. The endowment issue is now mostly over with over 3/4 of endowments now timebarred from complaint. Plus, you already know you cant complain on that one using that process.

block94875

Hi, this is my first time on here and I would like to ask if anyone could offer any advice.
Im looking into to an endowment reclaim for my dad who was missold a policy in the 80s. It was with Norwich and Peterborough.
I was speaking with him the other day and he has just finished paying off the mortgage an was left with another shortfall of about £1500.
Now that the mortgage has been paid, does this mean he loses any rights to reclaim. I know that he is happy that it has all gone away but I would like to persist to help him out if this is still possible?

dunstonh

I was speaking with him the other day and he has just finished paying off the mortgage an was left with another shortfall of about £1500.

So, he has probably ended up financially better off then. (typically endowment mortgages were cheaper than repayment.

ow that the mortgage has been paid, does this mean he loses any rights to reclaim.

No. However, over 3/4 of endowments are timebarred from complaint. Most were timebarred by 2007/8. The endowment issue is generally regarded as being offer now with just the odd straggler here and there.

So, timebar could be the first issue preventing it. Second issue is that you say 1980s. Regulation didnt start until 1988. if it is pre-regulation then he may have no-one to complain to depending on who sold the endowment policy to him.

There is also the reasons for complaint. You havent mentioned what they would be.

magpiecottage

Assuming this was a 25 year policy then it would have predated regulation - although the timebar letters would still have been sent.

There is also the question of who actually sold it. In those days, it was not uncommon for a representative of the life company to do that in the offices of the lender. The lender received commission but did not actually sell the policy.

steveb69_2

It is hard to believe that there are people on this forum still defending endowments as suitable at time of sale. Comments such as they were cheaper are ridiculous!, an interest only mortgage is cheaper but not necessarily suitable for most people. Insurers set anticipated growth rates on endowments unrealistically high in order to reduce premiums to make them "cheaper" while both the insurer raked off hefty charges to reduce the returns. In addition extortianate life cover rates could be hidden within the overall premium, & in case of with profits poor performance disguised as guaranteed sums plus bonuses. The typical loss of a year or two's premiums at start of plan could also be hidden in with profits or by the addition of capital units that showed on statements but generally had little value. The policy documents smallprint was undecipherable by most people who simply wanted to buy a home & not necessarily gamble on the stock market their home loan savings.
By the fact that hardly anyone takes them out today, nor does any insurer sell them is proof that they are not suitable now & perhaps nor ever were suitable. It is a disgrace that complaint time bars apply to these products!

Also hard to believe that general public are giving away compo' to these claims management firms despite so many warnings to simply complain direct to company & ombudsman.! The general public need protecting!

My comments in 2011 are pasted below

"I cant see the relevance of time bar being applied after red warning of poor performance, regardless of returns its the product thats at fault, they simply should not have been devised!

Typically an individual took a loan out on the biggest purchase of their life, the roof over their family's head!

By gradually paying off the loan over the term the individual wouldprotect their home,by reducing exposure to rising interest rates, reduce chance of negative equity, reduce chances of failing to repay interest incase sick or redundant or dead, have greater equity to carry forward when moving home thus giving greater range of mortgages & greater range of homes as you have more money to spend, all this along with not lining the banks pockets by reducing interest payable to them. Its a no brainer!

Instead typically an individual was told to pay interest only & gamble the capital repayment element away on the stock market & risk all the above issues for 25 years!

They may have been told that rather than invest in a flexible stocks & shares PEP/ISA with low cost term assurance, why not combine it into an endowment with profits funds that insurers have control over & like to use for other expenses & claims, along with being charged unknown life cover costs through the policy along with other fees & charges that are all hidden in the total policy cost! And when the stock market has peaked & interest rates are rising, no, you cant cash it in like any other investment & pay off your mortgage, as you will lose out on terminal bonuses & have penalties applied. In addition huge upfront commission are payable on endowments that would not usually be paid on other unitised investments likes PEPs, unit trusts or ISA's.

Regardless of returns , has there ever been a mortgage endowment that was not mis-sold ,what could possibly outweigh the disadvantages of being tied into an endowment contract?. I would be interested to know of anyone that feels they were correctly advised to take one out.!

Last edited by steveb69; 14-09-2011 at 4:52 PM.

dunstonh

Comments such as they were cheaper are ridiculous!

Sorry that you feel a factually correct bit of information is wrong.

an interest only mortgage is cheaper but not necessarily suitable for most people.

Not paying it at all is even cheaper but neither that or your example are comparable.

By the fact that hardly anyone takes them out today, nor does any insurer sell them is proof that they are not suitable now & perhaps nor ever were suitable.

No its not. Things just move on. S&S ISAs made endowments largely redundant and PEPs before them were already having an impact on volume. Then the issues that led to the decline of returns and the failures to hit targets and the bad press that came from it meant that anyone trying to market an endowment would be crazy.