Endowment Mis-Selling?

polybear

Hi,
My mum has had an Endowment Life Insurance Policy with CIS (the Co-op) for the last ten years, and has just been paid out. It was only a small policy (she paid in a total of about £650); however the payout cheque is 30 quid less than she paid in!!
I've also got two endowment policies with them, both over 20 years and for larger sums (about £6300 and £5500 total payments over the lifetime of the policies).
I've yet to write to the CIS regarding my mum's shortfall; I'll also ask about my own policies at the same time.

My question is: Bearing in mind that none of the policies are associated in any way with a Mortgage, could we claim for mis-selling in the same way please? Thanks.

Polybear.

dunstonh

My question is: Bearing in mind that none of the policies are associated in any way with a Mortgage, could we claim for mis-selling in the same way please? Thanks.

no you cant.

It is not possible to complain about performance of investments and savings endowments are not the same as mortgage endowments.

Of course, you could argue that risk wasnt disclosed and the CIS would have to prove it was. Also 10 years ago, the CIS did offer PEPs and they would have been the better option (subject to minimum premium which was above what she would have been paying so easily eliminated).

EdInvestor

Check out the Which website for complaint grounds.

https://www.endowmentaction.co.uk

dunstonh

Which do a complaints section for saving plans then?

dreamylittledream

dunstonh wrote:

no you cant.

It is not possible to complain about performance of investments and savings endowments are not the same as mortgage endowments.

Of course, you could argue that risk wasnt disclosed and the CIS would have to prove it was. Also 10 years ago, the CIS did offer PEPs and they would have been the better option (subject to minimum premium which was above what she would have been paying so easily eliminated).

Hmmmm slightly misleading here dunstoh - you can claim for mis-selling as the polcies may not have been suitbale for you and your mother - but the Which letter et al would not be appropriate as they are geared to mortgage endowment policies.

To the OP - I'd say it depends on what sort of policies you have. If they are standard full endowment policies (that have a guaranteed sum assured) then you have a tricky argument - they will pay out what the promised to pay. Your attitude to risk doesn't really come into play as the policies do what they say on the tin - projections of amounts over and above the sum assured are just that - projections.

However if they are 'low cost endowments' (with a higher 'target amount' and life cover value then 'sum assured') then you have a fair argument that these were unsuitable as savings investments (why exactly would you pay extra for life cover that you probably did not need?).

Either way the compensation would be a full refund of premiums with interest minus the surrender value or maturity value of the policy - in your mothers case this is probably not going to amount to a huge amount more on such a small policy...

EdInvestor

The Which site is helpful IMHO even if not directly applicable as it explains in detail what needs to happen for a missale to take place - atttitde to risk, suitabity for person's needs, what needs to be pointed out etc. Quite helpful for other products as well, not just endowment mortgages.

dunstonh

Hmmmm slightly misleading here dunstoh - you can claim for mis-selling as the polcies may not have been suitbale for you and your mother

It's not misleading. You cannot put a mis-sale complaint in against a savings plan using the excuse that you should have had a repayment mortgage. The only real thing you can complain about is the risk element or possible better alternatives, which I mentioned.