Endowment Compensation Advice needed

barryd999

Hi

A company called EMC has called me today asking if they could take up my case for compensation on an "miss sold" Endowment taken out in 1992. Our mortgage is paid off and I have ingnored the letters over the last few years saying it may not make its target. I guess I am apathetic about it as I have no money worries regarding the mortgage now.

They say they will only bill me once they are succesful and their costs would be 35% plus vat of the the compensation paid out. It seems a lot but until this morning I wasnt ever going to do anything and they reckon that 9 out of 10 of their cases are succesful as appose to 2 out of 10 where people take up their own claims.

I havent the time or knowledge to do this myself so I was wondering I should just let them go ahead.

Is 35% a typical charge and does anybody know about this company? I dont mind them earning a cut if they end up getting me some money I otherwise would have done nothing about but I dont want to end up being scammed or being hit for other charges if it all goes wrong

Any help or advise appreciated

Barry

dunstonh

It is estimated that over 3/4 of endowments are now time barred from complaint. So, before you do anything you should contact your endowment provider and ask them if you are timebarred. No point wasting your time if you are.

they reckon that 9 out of 10 of their cases are succesful as appose to 2 out of 10 where people take up their own claims.

That is incorrect. The information published by the FOS actually states that claims companies are no more successful than personal complaints and indeed many are less likely to succeed than a personal complaint.

Whilst they dont say why, the general feeling is that many claims companies do not personalise the reason for complaint. They just list every possible reason whether it is applicable or not. This can work against you when you have a client file which doesnt have enough evidence in your favour or the firms favour and a balance of probability decision needs to be made. They look at the side that is most credible.

So, if yours looks like a try-it-on complaint with loads of reasons and if some of the reasons are easily shown to be incorrect (i.e. what you have claimed is easily rebutted) then it makes you look less believable than the firm.

Most endowment complaints are not upheld or paid out on. However, of those that are paid out most are not actually upheld but still have redress paid due to insufficient evidence. So statistically, you are likely to fall into that category and you dont want to harm your complaint by giving reasons that can make you look like a liar. (or in complaints speak your memory events is unclear and confused).

They say they will only bill me once they are succesful and their costs would be 35% plus vat of the the compensation paid out.

Thats very high. However, it probably reflects the ever decreasing chances of success nowadays.

EdInvestor

You are likely to be time-barred if it is 3 years since you received a 'red light' letter stating that there is a strong likelihood of a shortfall at maturity and you have not responded by making a complaint.

barryd999

thanks for the replies. I reckon its way over 3 years since we started receiving letters. This woman from the company I mentioned has just called me again and seems a bit pushy which is also putting me off.

sounds like a waste of time to me,

I will however do as you suggest and make enquiries as to if we are time barred or not.

Thanks
Barry

barryd999

Hi

I wrote to Black Horse / Scottish Windows and explained that I felt our policy was mis sold. I got back a form to fill in later followed by a further letter stating we are time barred from 2006. They also sent me copies of letters and Red letters warning of a shortfall from 2000! Didnt realise it was that long. They have said they will not explore it further as it was time barred but I can take it up with the ombudsman if I like. I presume this is now a waste of time or should I take it further or indeed hand it over to the claim chaser company who contacted me in the first place?

Thanks

dunstonh

but I can take it up with the ombudsman if I like.

You can but the time bar applies to the FOS as well. So, they will just reject your complaint as being out of time.

I presume this is now a waste of time

it is.

or should I take it further or indeed hand it over to the claim chaser company who contacted me in the first place?

Claims companies cant overule the time bar. So, that would be pointless.

its game over i'm afraid.

barryd999

Many thanks for that

Game over it is then. I suppose I should be thankful that our mortgage is paid off. The endowment predicts a £13K shortfall and its only a £34000 endowment! I pity anyone whos struggling and has to find the shortfall somewhere else.

Regards
Barry

dunstonh

I pity anyone whos struggling and has to find the shortfall somewhere else.

In reality no-one should be struggling. The things that have caused many endowments to run short are the things that have made us financially better off in other areass. Mortgage rates came down and monthly payments have been much lower for over a decade. So, as long as people used some of that money each month to budget for the shortfalls (which started to appear about a decade ago) then they should be fine.

it should also be noted that for most people, the endowment mortgage cost less than a repayment mortgage. So, even when there is a small shortfall at the end, the person could still end up being financially better off.

Endowments are obsolete and the whole affair could have been handled better (by perhaps forcing people to use some of the monthly mortgage savings to put aside to the mortgage) but there are very few people that are financially worse off overall by it.