Endowment compensation

doublebee

This may seem like a put on but it's a genuine question! I took out a mortgage several years ago with an endowment insurance attached.My insurance company has written to me stating that at maturity it will be insufficient to pay my mortgage off let alone give me some extra cash.

However....I have already paid my mortgage off so can I still claim compensation on the grounds that the policy is going to pay out far less than I had been led to expect when I took it out.

dunstonh

can I still claim compensation on the grounds that the policy is going to pay out far less than I had been led to expect when I took it out.

That is not valid grounds for complaint.

If you did have a valid complaint and it was upheld, the compensation payable would be calculated upto the point you paid off the mortgage.

VickyM_2

I've asked this on another thread, so apologies if it really is a silly question.

What if the endowment has now been put against another mortgage, but one that is smaller than the original? but the underperforming endowment is unlikely to pay off the new mortgage? (a condensed version of my last question).

dunstonh

VickyM wrote:

I've asked this on another thread, so apologies if it really is a silly question.

What if the endowment has now been put against another mortgage, but one that is smaller than the original? but the underperforming endowment is unlikely to pay off the new mortgage? (a condensed version of my last question).

I read your other one and chose not to answer. No, I wasnt being rude but I don't know.

In theory, the old mortgage was paid off and that would be point of calculation for any compensation. If it was pre 2001 that you paid it off, chances are there wouldnt be any compensation because up to that point, most endowments were on track. Moving to another mortgage wouldn't normally be classed as a break point for calculations as people change lenders all the time. However, in your case, you changed the amount, and was it an existing mortgage you added your name to or start a joint mortgage of a lower amount in its place? In which case, I can't be sure
what the absolute answer would be. Maybe DOTW will spot this and answer. He is bound to know for sure.

defender_of_the_weak

Any breaks in mortgage repayment will be factored in to the calculation and if the policy is used against a new smaller mortgage the calculation of loss will be proportionately scaled down to reflect this.

However, BEWARE, the systems used by some companies calculating loss in similar circumstances slant this detail and are not quite correct. This leads to offers showing no loss when in reality the shortfall as of today is thousands of pounds.

If you are unhappy, you can go to FOS or post the details on here

VickyM_2

Hi

thank you both for your responses, its very much appreciated! I've made a note of your comments as I'm such a dunce at this kind of thing.. I'm writing today to the Halifax, and my partner is writing to his endowment provider - nothing ventured, nothing gained. Will keep you posted of any response.

Best

Vicky