Suspicious compensation cheque

sticher

Hi, this is my first post so I hope I am posting in the correct place. I have tried to read alot of the posts on the missold endowment thread, but none seem to have the same query as myself.

A while ago I put in a complaint regarding the shortfall on my endowment policy. We took it out to cover our mortgage in 1985 and like alot of people were told we would have a large lump sum on top of our mortgage at the end. We were refused.

Then about two weeks ago (months after my complaint) we received a letter saying that they (Halifax) felt that we might have a claim to compensation, but in the same letter said that it would not be down to being missold a policy. I filled in the forms (specific to our mortgage) and then this morning we got a cheque for just over 1,400.

Obviously it does not cover the predicted shortfall in our endowment, but they state it represents money we would have had if we had taken out a repayment mortgage at the time.

I can't help but be suspicious - after all, when does any bank just send you a cheque/letter saying they might owe you money? Does anyone have any ideas on this?

Thanks for any help.

Fiona

dunstonh

Then about two weeks ago (months after my complaint) we received a letter saying that they (Halifax) felt that we might have a claim to compensation

When you case was re-checked, they overturned the first reviewers decision. Not uncommon with certain advice companies who were over zealous in their initial refusals and have been told to recheck.

Obviously it does not cover the predicted shortfall in our endowment, but they state it represents money we would have had if we had taken out a repayment mortgage at the time.

redress isn't meant to cover any potential shortfall.

Your complaint is that you think you should have had a repayment mortgage. Halifax are unable to confirm it was mis-sold but are not able to confirm it wasnt (most are like this). In these cases, the assumption is with the policyholder and redress is paid. So they calculate how much you should be paid to make up the difference in costs between a repayment mortgage and endowment mortgage to the point of calculation. If you surrender the policy and take the redress and surrender value and pay both into the mortgage, you will be put in the position you would have been had you gone repayment mortgage from the start.

I can't help but be suspicious - after all, when does any bank just send you a cheque/letter saying they might owe you money?

The bank isnt just sending you any money. The advice company arm of the bank hasnt been able to justify the sale and proper and correct redress has been offered. The redress is calculated to a defined method and unless you feel the figures input are incorrect, then there is no point arguing with it.

sticher

Thanks for your answer and I understand your points.

If you surrender the policy and take the redress and surrender value and pay both into the mortgage, you will be put in the position you would have been had you gone repayment mortgage from the start.

I'm not sure whether this amount would ensure the above (although from reading other posts I realise it's not as straightforward a calculation as can be thought).

So it seems then, from what you say that I can bank the cheque without the fear of finding out in the future that I could have claimed alot more. That's really all I wanted to know - didn't want to make a huge financial error without checking it out first.

Thanks again,

Fiona