Scottish Widows endowment query

contired

In 1986 I bought a house for £38,000. I was single man but I was advised to take out a 25 year low-cost endowment from Scottish Widows to pay back the mortgage. I sold the house 11 years later but kept the low-cost endowment running which finally matured last May 2011, and for 24 years of this 25 year period I received a annual ‘Bonus Notice’ (basically an annual statement) showing me the ‘Guaranteed Benefit’, ‘Existing Bonus’ which was the accumulated bonuses of previous years, the ‘New Bonus Added’ for the current year, and the ‘Total Benefit’ which was the total of all of these three amounts added together.

On 27 March 2011 Scottish Widows sent me a letter showing an estimated maturity value of £26,939.15, but they went on to say, that as my maturity payment includes bonuses that are not guaranteed the amount they pay on the actual maturity date may change.

In April 2011 I called Scottish Widows to ask them what the maturity value was at that time and they told me it was £29,939.15. This amount was exactly £3,000 more than the estimated maturity value they put in their letter, so I thought I would wait for the ‘Final Bonus Notice’ (Final Statement), so I could check this out before contacting them about it, but I did not receive one, which I believe I should have done and I have been in dispute with Scottish Widows about this as they say they don’t issue closing statements, but surely this can’t be right.

I received the lower estimated amount at maturity.

If anyone can shed any light on this or comment or advise on this I would be grateful.

Many thanks.

dunstonh

A lot of these old style polices have information that is manually input. So, it could be a typing an error.

I had a client some years ago who had a mistyped pension valuation and when they found out the real figure, we complained. The insurer rejected it as it was a human error. It went to the FOS who rejected it as as well. Just because an error has occurred, does not mean you were ever entitled to that money. It wasnt as if they were taking something away from you that was yours.

Old fashioned industrial branch plans or early ordinary branch plans on conventional with profits basis (guaranted sum assured to which a bonus is added) rarely have closing statements in the modern sense. The maturity advice is effectively the closing statement. Some providers were able to build statments into legacy plans but it was with varying success and often the attempts created anomalies.

holly_hobby

As Duns. states, you can't complain for loss of expectation (i.e lower non-gted returns than anticipated).

Completely understand why you feel v disappointed - but as Duns says, even going to FOS won't get you anywhere due to the above investment basis of the contract.

Best to put it to bed I think ... even though I know you're probably well naffed off !!

Sorry if not what you wanted to hear ..

Holly x

contired

holly hobby and dunstonh, many thanks for your time and for your replies, it's very much appreciated.

I can understand a typing or verbal error being made, and if there was one I would not expect to be entitled to that money or for the loss of expectation. The point is shouldn't Scottish Widows provide a final/closing annual statement to validate the ‘Guaranteed Benefit’, ‘Existing Bonus’ which was the accumulated bonuses of previous years, the ‘New Bonus Added’ for the current year, and the ‘Total Benefit’, as they previously did for the first 24 years of the 25 year investment, rather than just putting this information in a letterhead, it seems extremely strange to me not to receive the 25th and final closing statement. If you were to close an ordinary bank account wouldn't you expect to get a final/closing statement informing you of the closing balance rather than the bank writing you a letter to give you this information?

Fuller details are given below in an attempt to show why I believe things are not quite right. As before, if anyone can shed any further light on this or comment or advise on this I would be grateful.

On 27 March 2011 Scottish Widows sent me a letter showing an estimated maturity value of £26,939.15, but they went on to say, that as my maturity payment includes bonuses that are not guaranteed the amount they pay on the actual maturity date may change. They also gave me an option to take the proceeds or use their high interest Loyalty Deposit savings account.

In April 2011 I called Scottish Widows to inform them that I would take up their offer and open a bank account with them and they sent me an application form to open a new bank account together with a payment authority form to give them authority to transfer the money to the new bank account. I also asked them what the maturity value was at that time and they told me it was £29,939.15. This amount was £3,000 more than the estimated maturity value they put in their letter, so I thought I would wait for the ‘Final Bonus Notice’ (Final Statement), so I could check this out before contacting them about it, but I did not receive one.

So, on 5 June 2011 I wrote to them to explain this to them and to ask when I would receive ‘Final Bonus Notice’ (Final Statement).

They wrote back to me saying as the policy is maturing in May 2011 there will be no ‘Bonus Notice’ issued and the 2010 bonus will be included in my maturity value.

I was astounded to hear this and I wrote back to them to reiterate that my enquiry was about obtaining a ‘Final Bonus Notice’ (Final Statement), and that I already understood and knew that the 2010 bonus would be included in my maturity value, but this does not include or show the ‘Final Bonus Added’ and the ‘Final Guaranteed Benefit’. And that, as their letter of 27 March provides an ‘Estimated Maturity value’, and states that my maturity payment includes bonuses are not guaranteed and on the actual maturity date the amount they pay may change, then surely the next normal and expected step to take would be to issue an official ‘Final Bonus Notice’ (Final Statement) and I asked them to advise why one would not be issued.

In July 2011 they wrote back to me confirming that as the policy matured on 2 May 2011, a bonus notice for 2010 would not have been issued as they do not mail these until the middle of April each year and that for any policy maturing within 6 weeks of this period they do not send a notice as the final maturity packs are sent at this time. And that the maturity pack was issued to me confirming the final value payable.

I wrote back informing them I did not receive the maturity pack and to ask them to send it to me again.

They wrote back to me to confirm the maturity payment was transferred to the bank account I opened with them, and to show a breakdown of the bonuses.

I wrote back to them to inform them that I asked them to send me my maturity pack for the maturity my investment, and that I have been asking them for the appropriate and proper documentation for the maturity of my investment since 5 June and this should be a normal requirement for any investment, especially for one that I held with them for twenty five years. And I asked them again to provide me with my maturity pack.

In August 2011 they wrote back to me stating that a maturity pack was sent to me, and they enclosed copies of the payment authority form and application form to open the bank account.

I wrote back to them informing them that unfortunately, neither of these documents shows the ‘Maturity Value’ and neither has anything to do with the maturity of my investment. The application form is just that, an application form to open a bank account, and the payment form is just that, authority to deposit a payment of £26,939.15 into the bank account, which is the ‘Estimated Maturity Value’ shown in their letter of 27 March, and which is why I wrote to them in the first place on 5 June. And so, for the fifth time I asked them to provide me with copies of my maturity pack or the appropriate and proper documentation for the maturity of my investment showing the ‘Final Interim Bonus, the ‘Terminal Bonus’ and ‘Maturity Value’.

In September 2011 they wrote back to me stating they had fully investigated my concerns and that a breakdown in communication had occurred making it necessary for me to have to send repeated requests for details of the final maturity value, and that use of certain terminology such as ‘final bonus notice’ led to confusion on their part. And, they went on to provide a breakdown of the sum assured and bonuses and total all of which I already knew. And, they enclosed a cheque for £50 for the inconvenience they caused me, and a ‘Financial Ombudsman Leaflet’ if I remained dissatisfied.

I wrote back to them explaining I have not, as they have stated, sent repeated requests for details of the final maturity value (which was provided in their letter of 20 July 2011), but that I had sent them repeated requests for the appropriate and proper documentation for the maturity of my investment or for a copy of my ‘final maturity pack’. I went on to say I could not see how using certain terminology, such as ‘final bonus notice’ could have led to any confusion or misunderstanding on their part, especially as this was clarified in their letter of 1 July 2011; and that it had been quite clear throughout my correspondence that I had been requesting for the appropriate and proper documentation for the maturity of my investment, regardless of what terminology they or I had been using., and that I already knew about everything else they had mentioned. I asked them yet again to send me a copy of my ‘FINAL MATURITY PACK’ that was issued approximately 4-6 weeks prior to the maturity date, which confirms the final value payable and includes all relevant bonuses including the addition for 2010 and for the interim period January 2011 to April 2011 inclusive. I enclosed and returned the cheque for £50 to them, as it did not compensate for not receiving my ‘final maturity pack’, and in any event it barely compensated for the time and trouble, and worry, stress and concern this was causing me.

In October they wrote back to me stating more nonsense about a breakdown in communication. They then said I believed a ‘final maturity pack’ was due to be sent to me however they can confirm no such pack exists. They went on to say they issue one maturity pack to policyholders 4 to 6 weeks before their policy maturity date, which they say was sent to me on or around 27 March 2011 and they know I received this because I completed and returned the Payment Form they enclosed with it. And, there was no rate change between the date they issued the pack and the date the policy matured, and that I have received all the correspondence I was due to receive in relation to my maturity claim, and that the document ‘final maturity pack’ does not exist.

They then said they were disappointed I was unable to accept their previous offer of £50 in recognition of the poor customer service I had experienced and the inconvenience they had caused me. They said they didn’t feel increased compensation was due to me in respect of me not receiving a final maturity pack which doesn’t exist, however as I am clearly aggrieved by this situation and in recognition of the obvious misunderstanding which had occurred they enclosed a cheque for £100.

In December 2011 I wrote back to them and said that although I referred to the maturity pack as a final maturity pack in my letter of 24 September 2011 I did previously refer to it as maturity pack in my letters of my letters of 27 July 2011 and 20 August 2011, and although I wrote in my letter of 11th July 2011 that ‘I have not received the final maturity pack’ I did go on to ask them to ‘send me the maturity pack again’, and in my letters of 20 August 2011 and 24 September 2011 I requested for the appropriate and proper documentation for the maturity of my investment, regardless of what terminology they or I had been using. And that, in any event, it was clear from the word ‘maturity’ alone, what I have been requesting for, and also in the content of my letters.

And I went on to say that as for the maturity pack, which they sent to me on or around 27 March, this takes us all the way back to their letter of 3 August and my letter of 20 August 2011. All I received was a general letter with an estimated maturity value, and an application form to open a bank account, and the payment form was to give authority to deposit a payment, and that these were not appropriate documents for the maturity of my investment, and none of this documentation shows the ‘Maturity Value’ or has anything to do with the maturity of my investment, and which is why I wrote to them in the very first place on 5 June 2011. And, regardless that the value they paid on maturity of my policy was the same value they quoted when they had written to me previously and there was no rate change during this time I should have received an official document on maturity and not just a general letter. I reiterated that £50 does not compensate me for my time, trouble, worry, stress and concern this matter was causing me, and neither did the cheque for £100 that they enclosed this time. And I returned and enclosed the cheque for £100. I went on to say that for an investment that I held with them for twenty five years for which I received an annual bonus notice (in effect a statement) for twenty four years, there had to be an official twenty fifth and final or closing statement, so I asked them to escalate this matter further or to fully investigate this matter properly again, and for the seventh time I asked them to provide me with an official closing or final statement or the appropriate and proper documentation for the maturity of my investment, regardless of what name or terminology they or I had been using, which confirmed the final value payable and included all relevant bonuses including the addition for 2010 and for the interim period January 2011 to April 2011 inclusive. And that it was completely and totally astounding and unbelievable that they had not done so yet.

They wrote back to me saying there was not much more they could say which would not be a repeat of their previous letters and the correspondence they had sent me in relation to the maturity of my policy is what they send to all customers as a matter of course. They went on to say they don’t issue closing statements, however they had suggested to the manager of their maturities Team that they review their process going forward, as they agree this information would be of use to their customers.

They enclosed what they called a ‘Closing Statement’ on a letter headed piece of paper showing the same breakdown of the final maturity value that was included in the letter they sent to me dated 19 September 2011. And they finally referred me back to the Financial Ombudsman Service if I remained dissatisfied.