Report Endowment Misselling Compensation SUCCESSES

dunstonh

janruxton wrote: »

Hi

I am new to this site and would be grateful to hear if I can make a claim against my insurance company who provided me with my endowment policy. I recently paid off the loan I had so asked to cash in my endowment policy as it no longer applied. However, I noted that for the past 15 years I have also been paying for a sickness insurance. I am sure I was not advised at the time that it would apply to the policy as I took out a separate sickness policy (which incidentally I am still paying for and for which I have never made a claim) hence the reason I am sure I did not apply to include it with my insurance. I received my redemption figure and it was less than what I had originally put into the policy. This is because of the additional sickness policy. Can I claim against the insurance company for this sickness policy as, mentioned above, I took out a separate policy to cover my mortgage and the loan that his endowment policy applied to, so obviously did not intend to double up. Looking forward to receiving some help.

The insurance company has no liability for anything you choose to purchase unless you used an agent of the insurer.

I am assuming you are referring to waiver of premium (sometimes called waiver of contribution). This is not to be mixed up with payment protection or accident and sickness insurance and does not overlap with a PPI policy in this respect. The cost of waiver of premium does not reduce the returns.

It was considered best advice to have waiver of contribution on endowments of that era (and personal pensions). Its rare for them to be classed as bad advice.

What would be your reason for complaint as you havent given one so far?

tifo

mikon wrote: »

I have been advised that I am time barred and therefore a pointless exercise. However I very pleased you have replied to my post. What is the process can you help in anyway.

You have 3 years from receiving a 'red' letter informing you of a shortfall and another letter 6 months before the 3 year expiry or final date for a claim. So depending on when Aviva informed you of the shortfall, make a complaint about the policy and ask for the shortfall (as well as the final value sum) in compensation.

From the FOS:

Since June 2004, firms have been required to set out a final date for consumers. If a consumer does not complain to the firm by this date, the firm can object to our considering the complaint, if it is referred to us.

This new rule sets the time limit at three years from the firm’s first warning to the consumer (in what has become known in the industry as a "red" letter) about the high risk of a shortfall, provided that the consumer also received – within the three-year period and at least six months before the final date – an explanation that the time limit will expire at the final date.

magpiecottage

MIKON also says the policy was taken out in 1987. That means it is pre-regulation anyway. FOS would only have jurisdiction over advice given by a representative of one of the predecessors of Aviva (Norwich Union, GA/General Accident, Provident Mutual and Commercial Union if I remember correctly).

If it was an independent adviser you would not have been able to take them to FOS regardless of when you complained.

Thomascook

Hi Everyone,

I'd be grateful for any advice. In Jan 1992 I took out a Friends Provident endowment which was expected to pay out £21500. In Oct 2004 I wrote to them to complain about misselling & they replied I was time-barred on the grounds they wrote to me on the 20th May 2000 and a second re-projection letter on 27th Dec 2002.

Now I have read a few posts here & there is some mention of the rules for FP time-bar window being changed around the 2004 time. So the question is was I fobbed off too easy back in 2004 and do I have any change of making any claim.

The original letter from 20th May did mention high risk but the letter was titled just Update on your mortgage endowment plan, nothing as alarming as the red ones I get now. The letter even gave some Action you could take, (Increase you monthly savings blah blah) but with option 5 as Wait and See.

Many thanks.

magpiecottage

The rules about timebarring changed late in 2003 and again in 2004.

However, if you received a letter telling you there was a high risk of a shortfall in 2000 and another reprojection subsequently showing a possibility of a shortfall, this was sufficient for a firm to timebar.

Any case that it was already possible to timebar was not "untimebarred" by the change.

Thomascook

Okay thanks, I thought that would be the answer. Still makes you a bit mad when you look back older in life & have more of an understanding of money how they could even sell a 25 year policy which would need to have earnt 8%+ over its term. Should have been once missold always missold. Just as well I switched a while back to repayment & now look forward to little 'saving plan' to pay out in 2017.

Sorry to ramble & thanks again for your help.

magpiecottage

Thomascook wrote: »

Still makes you a bit mad when you look back older in life & have more of an understanding of money how they could even sell a 25 year policy which would need to have earnt 8%+ over its term.

When you took out the policy, 8.75% was generally considered a realistic long term return. However, long term inflation fell to much lower levels than had been encountered for almost the whole of the 20th century and, with it, investment returns fell as well.

That does not, though, mean the policy was missold. You would have been provided with an illustration at the time showing returns of 10.5% and 7.0%. If the required return was more then 7.0% the maturity figure at that rate would have been quite obviously less than the loan amount so it seems reasonable to suppose you would have appreciated there was some risk.

Should have been once missold always missold.

Maybe but there is also a long standing principle that a claimant must take reasonable steps to minimise any loss. As a result, if you knew, or ought to have known, that you had grounds for complaint then there is a requirement on you to draw it to the attention of those responsible so they can rectify it before it becomes worse. If you do not, then any loss that would have been avoided if you had acted promptly is not their responsibility.

Timebarring extends this principle by assuming that you were aware of the issue but did nothing about it within a reasonable and therefore have not complained because you accepted it was a risk at outset and you had no grounds for complaint.

Just as well I switched a while back to repayment & now look forward to little 'saving plan' to pay out in 2017.

Which seems to indicate that you did know something was wrong at tat time.

fleetpete

Hi new to this forum,I purchased an endowment from Standard Life in April 1988, and have considered claiming for misselling but I was always under the impression that it would not qualify because it wasn't covered by the FSA legislatio,which | believe came into force in the August of that year(1988)

However I have been recently contacted by a company offering to make a claim on my behalf,with the obvious rewards for them!!! the thing is that they think the timebar and age of the policy may not be a problem,so have things changed recently and could I do it myself?

dunstonh

However I have been recently contacted by a company offering to make a claim on my behalf,with the obvious rewards for them!!! the thing is that they think the timebar and age of the policy may not be a problem,so have things changed recently and could I do it myself?

Timebar may be an issue as 3/4 of all endowments are now timebarred. You may be in the 1/4 that are not but Std Life can tell that if you ask them.

Claims companies tell you all sorts of rubbish on the phone as the sales rep is paid to get people to use them. If you are timebarred then it is very rare for a time bar to be overruled. Std Life time bars have been set correctly with no known cases of them being overruled for failing to apply correctly.

Hi new to this forum,I purchased an endowment from Standard Life in April 1988, and have considered claiming for misselling but I was always under the impression that it would not qualify because it wasn't covered by the FSA legislatio,which | believe came into force in the August of that year(1988)

FSA regulation started 29th April 1988. If you signed the application before 29th April 1988 then only if you used a Std Life rep will they consider your complaint. If you used a solicitor, accountant or what is now an IFA then they wont consider it.

If you didnt use a Std Life rep but the used what is now an IFA but the IFA is no longer trading then you needed to have signed the application after August 1988 to get FSCS protection as that didnt kick in until later in that year.

What distribution channel did you seek advice from?

fleetpete

I can't remember who I sought advice from,and the seller was an IFA i'm pretty sure,he is no longer around.

It confirms what I suspected all along that my endowment doesn't qualify for compensation,which is odd as why would this company, I believe it is EMC,be remotely interested.