Contracted out pensions misselling

EdInvestor

According to the Scotsman the FSA plans to produce a report on this in January which will find no widespread misselling, but concerns with some groups, mainly age related.

So if any complaints firms contact you, it's probably better to wait for the report, to see if you are affected before deciding on making a complaint.

DON'T deal with any firm that wants money upfront, and remember that pensions misselling redress money is not paid to you in cash,but directly into the pension fund, so you can't get at it until you are over 50, at the earliest.

dunstonh

The last FSA report said that they believe that around 200,000 to 400,000 people contracted out outside of the suggested age bands.

In the scheme of things, that is quite a small number and these people can be identified. One of the options the FSA is considering is to get the advising companies to pro-actively check these cases to see if the advice stacks up.

It should be noted that it doesnt mean that between 200-400 thousand were mis-sold. The recommended ages changed with different providers depending on the contract that was sold. So, a low charged contract could allow contracting out at an older age than the benchmark average. Also, some people would have chosen to contract out anyway because of Govt distrust.

Whilst Which? state that 3/4 have lost out, in 1996, the SIB stated that everyone that contracted out upto that point was financially better off. A stockmarket crash would have made many worse off whilst a recovering stockmarket would put people back better off again. I do feel that Which? are looking at this in a very short term point of view. The fact that the SIB stated in 1996 that everyone was financially worse off has probably helped the current regulator come to its decision. After all, if the regulator in 1996 says people are better off, it cant really go back on that 10 years later. Especially as many would have used the 1996 information as supporting the recommendation to contract out.

One thing is clear from this though. Dont use a claims company and especially not those rip off merchants from Morgan Green who will tell you anything just to get that £500 off you.