Help with parent's endowment

Oompa_Lumpa

I would be grateful if someone could tell me what my parent's first steps should be re their shortfall in endowment.

They took out an endowment in about 1986ish, their mortgage is with A&L.

They have known now for I suppose 5 years that there is going to be a shortfall, but my parents are the "bury their heads in the sand type" and didn't do anything about it.

They have recently received an offer from a company (don't know their name off hand) who will process their claim on a fee of 25% of the eventual award.

Now my father is of the attitude that if he doesn't permit the company to chase up the shortfall then he won't "be bothered / have the knowledge" to make a claim for himself, so he thinks that 75% of something is better than 100% of nothing.

How easy is it for him to make a claim now (since he has known about it for a few years), and what practical steps should he take to do this?

dunstonh

Who sold the endowment? This is very important as it is pre 29th April 1988 when regulation came in. Unless the advising company has signed up to accept pre 1988 advice based sales, then you have no right to any compensation.

loobs40

Oompa_Lumpa wrote:

Now my father is of the attitude that if he doesn't permit the company to chase up the shortfall then he won't "be bothered / have the knowledge" to make a claim for himself, so he thinks that 75% of something is better than 100% of nothing.

It took me one letter, taken from the Which consumer site, and filling in a short, straightforward questionnaire and my partner has received a £2700 compensation offer within a couple of months.

His was a pre 1988 endowment, but it was with the Yorkshire BS who have signed up for the voluntary agreement

HGLTsuperstar

Have the Abbey signed up to the pre-1988 voluntary agreement? I'm guessing not knowing their overall attitude towards customers/money cows, but can someone please confirm

Oompa_Lumpa

Their Endowment is with Winterthur.

Have they signed up to the pre 1988 compensation scheme?

defender_of_the_weak

Back abbey and winterthur have signed up for voluntary jurisdiction although both of them will try and kick the complaint in to the long grass on the basis of 'the rules was different then

Oompa_Lumpa

Bearing in mind that they have probably exceeded the "3 year window*", is there any point in them making a claim?

* I don't know for certain when they knew, but it certainly seems like longer than 3 years

EdInvestor

The 3 year timebar starts when they got the "red letter" warning there was a "high risk of shortfall".

Earlier warnings of the amber variety don't count.

So if the red letter arrived after April 2003 they can still claim.

Oompa_Lumpa

I spoke to my parents and they don't know if they kept the "red letter" or not - (sometimes I wonder why I bother).

They are going to have a look, but if they haven't kept the letter could they contact Winterthur and get Winterthur to tell them when they received the "red letter"?
Or are Winterthur liable to call their bluff and say "we sent that in 2002", knowing full wel that my parent's won't be able to contradict that?

defender_of_the_weak

send the initial complaint and see what winterthiur say in response

Oompa_Lumpa

If EdInvestor (or someone else) could give their opinion on what they should do with their Endowment policy based on the following numbers I would be most appreciative:

Policy 1 to cover £25k capital
Guaranteed Sum Assured £10,575
Declared Bonus £7,404
Surrender Value £15,591
Maturity Date May 2010
Monthly premium £41.23

Policy 2 to cover £5k
Guaranteed Sum Assured £2,090
Declared Bonus £1,239
Surrender Value £2,846
Maturity Date June2010
Monthly premium £8.91

Also there is a terminal bonus as of today of 15% on both policies.

Also as an aside my father has just checked his 2002 statement and all the values above (guaranteed sum, declared bonus etc) were the same today as they were then - does this mean that they have effectively been "wasting their money for the past 4 years (at least)?