Mis sold a pension?

SamMoffatt28 · 29 March 2006 at 4:14PM

Hi all, I wonder if anyone can help please?

I believe my hubby was mis sold a pension when he was about 17/18, he did not understand what he was getting into and basically took it on because the sales person who approached him (he did not approach them) made it sound like a good idea. This was way before I met him but as we are now married it is partially my problem as it affects out future. I am trying to unravel the mess but don't understand half the jargon or how we can even find out what's gone wrong. He seems to understand even less about it than I do, lol.
Basically, I think he opted out of 'serps' (?) and paid into a private scheme instead on the advice of this sales person. He has a statement which states £845.98 was allocated to his private pensions fund in 1995/1996 inc bonuses and tax relief. Another letter says that the total value of the plan was £939-74 in 1997. The pension was originally with Britannic assurance, but I believe they may have been taken over by combined life (from the letters he has it seems so).

Is it possible for him to claim any of this money back and would he still be opted out of serps or would he have been opted back in again at any point? He pays NI and Income tax out of his wages. I am not mathematically minded and so I am not really able to understand what's what here.

I would really appreciate any advice, so that if we need to go to IR or DSS or even CAB then I can go armed with some information!

Thanks in advance I really hope you can help !

margaretclare · 29 March 2006 at 6:21PM

Hi Sam

Britannic Assurance is still in existence - I just looked up their website. http://www.britannic.co.uk. They have Britannic Retirement Solutions, which seems to be the pensions part of their business.

What you could do is to write to Britannic and ask for a valuation of what your husband's plan is worth now, what it's projected to be worth in 5 or 10 years' time. Is he still paying into it?

You say what the plan was worth in 1997 - that's a long time ago! Has he not been sent any details more recently?

Normally if you pay into a pension plan you can't get any of the money out until retirement age, which is going to be 55 at least. This is because the tax relief given is meant to help towards saving for retirement. At 17/18 your husband should have been thinking about starting some savings for himself and his more immediate needs, rather than listening to someone trying to sell him a pension.

HTH

Margaret Clare

EdInvestor · 29 March 2006 at 7:57PM

There isn't necessarily any problem here.

Just contact Britannic ( now owned by Resolution Life) and ask for a "transfer value" of the pension, which will tell you how much it's worth now.

Is hubby still opted out of Serps? Has your query arisen because Britannic is suggesting he should now contract back in?

SamMoffatt28 · 30 March 2006 at 7:18AM

I'm not sure if I made myself clear, as I am pretty confused about it myself.

The problem is not necessarily the pension as in the long run he will need one - the fact is that he was mis sold it. We had heard that you could claim compensation if you had been mis sold a pension in the 1990's, and could get proper pensions advice. I don't want to 'wait and see' and then find out when he retires that we have a massive shortfall in pension contributions and end up with very little or nothing to live on. I don't know if he ever opted back into serps and he definately isn't contributing to any private pension fund now.
Perhaps I was wrong about Britannic assurance, maybe it was them who took over combined life. This all took place in the early 1990's and I didn't meet my hubby until 2000. All I have is a few letters that his mum found when she moved house - she has very little idea what happened either.
He is nearly 34 and I am nearly 30, so we really need to be thinking about the future, especially as we have 4 children.

EdInvestor · 30 March 2006 at 8:54AM

Your best bet is probably to start here for a state pension forecast(for both of you):

http://www.thepensionservice.gov.uk/atoz/atozdetailed/rpforecast.asp

You an also ask them if hubby is contracted in to SERPS/S2P now, or whether he is still contracted out and rebates are going to this Britannic ( or whatever it is) pension.

The timing is not optimal for a pension misselling incident - there were many such in the 1988-92 period, but in the mid 1990s there was no real reason to think that a person of his age would be disadvantaged by opting out of SERPS, quite the opposite.

He might have a case if there was no mention at the point of sale of any risk he might not get at much as if he stayed contracted in to SERPS.

In any case he cannot get the Britannic money out in cash (or not before he's 60 anyway) and nor can he put it back into the state system, so you need to pay attention to it and make sure it's well invested at low charges. So step one is to get the updated details about it.