Anyone with a 25 year endowment which matured recently ?

TheBlueVoice

BirnamBear wrote: »

25 year endowment taken out with Standard Life in March 1992 for £60,000.
Have been paying £86.40 a month and in February this year got my annual statement 6 weeks before settlement saying it was worth £38,000.This did not include the MEP.
Well it paid out on the 23rd of March and I got 51k ...not too shabby
I was pleasantly surprised,I'm guessing there was a final bonus in there along with the MEP guarantee from Standard Life.

Hi!

Just wondering, was the £38k figure for the lower, middle or higher projection?

Thanks!

BirnamBear

Was the middle figure.

wastbarks

Endowment matured in March 2017, £105/month over 25 years and supposed to cover £82,175. Value £51,651 so a £30,524 shortfall which I think is scandalous. I'm sure everyone on this thread had numerous communications over the years about a shortfall, we were lucky in being able to afford to convert to repayment mortgages, however, when you see it in black and white it makes you realise what a complete rip off was sold when we were all young and naive in our early 20's. We did get a small amount of compensation from the FSA as our financial adviser disappeared off the planet but it was small and doesn't make up for the shortfall. Makes me nervous about any investments moving forward other than bricks and mortar and that's being slowly picked at by our grasping goverment

TheBlueVoice

25 year endowment with Standard Life just matured with a figure of £30,180.49.

Taken out in April 1992 with a premium of £49.84/month inc life cover.

Target was £35628.

Plan value 14/4/2016 was 23638.09

Estimations as at 14/4/2016 were

lower mid higher
24500 25200 26000

istanbul20052016

My endowment policy matured last October (2016) after paying a monthly figure of £78.56 for the full 25 years which equates to £23568.00, I was advised that the maturity value was just £25535.22, with no terminal bonus, this is way below the target amount of £62400.
Naturally I complained immediately to Royal London, I had to copy in Phil Loney Royal London's CEO in order to get a response as they were not replying to my emails.

An investigation was carried by Sharon Bridgeman senior case consultant customer relations ( who reduced me to tears during one conversation) who confirmed that the maturity value was correct. They were happy with the investment returns and had followed the policy to the letter as per their own words.

I could not work out how a policy that was worth £21473.04 in September 2012, could only gain another £4062.18 over the last 4 years of the policy, during a time when the stock market has been booming. Royal London advised that this was part of their Mortgage Investment Strategy, (MIS) this document was supplied to me upon the completion of their investigation as I was not aware of this document/strategy.

I quote " On each of the last 5 plan anniversaries 20% of the amount of mortgage is switched into the SL deposit fund for safety". However on my policy Royal London switched 63.15% in October 2011, £12705.69, out of a total of £20119.86. The following year in October 2012, the rest of my funds had been transferred into the SL Deposit fund. By transferring all of the funds , this decimated any hope of future growth. The SL Deposit by Royal London's own figures gives a return of minus 0.3% per annum. Once again Royal London said that they were correct to transfer 20% of the mortgage value in the first year ( approximately £12705) , even though the policy had no chance in achieving the £62400 figure. Royal London did not respond to me when I asked why the whole amount of funds had been transferred over in 2 years instead of 5 years as per their MIS.

I then complained to Financial Ombudsman Service, who contacted me on 23rd January 2017, whereby I had to explain several times the nature of my complaint with Royal London. Within a week FOS upheld Royal London's decision, which I am completely baffled by as to how quickly the investigation was apparently carried out. I feel that nobody wants to make a decision against a large powerful company to my detriment.

I did make a claim for mis selling in 2004 for which I received approx £7800.

I think that Royal London have been negligent, by transferring my whole fund into a deposit account within two years, instead of over the last five years, which has negated any chance of fund growth during the last 5 years of the policy or am I wrong??

I feel that Royal London are getting away with it because they know I have nowhere else to turn to. The big companies always win at our expense. Please help.

Any advice would be much appreciated.

Pincher

You were supposed to sell endowments, not be the mug who buys them. Common mistake.

Would have got the commission double quick. No slippery Harry will wait 25 years for their fast cars and loose women.

TrickyDicky101

How much was your mortgage originally when you entered the endowment? I note the passage you quote says "20% of the amount of mortgage" and not "of the value at the time of the endowment" so maybe that accounts for the difference between what you think should have been transferred and what actually was?

dunstonh

I could not work out how a policy that was worth £21473.04 in September 2012, could only gain another £4062.18 over the last 4 years of the policy, during a time when the stock market has been booming.

2016 was a good year but the period from 2012 to 2015 was less and included a nothing year and a negative year. However, to get returns related to the stockmarket, you have to be invested in the stockmarket and you were not fully invested that way.

Royal London did not respond to me when I asked why the whole amount of funds had been transferred over in 2 years instead of 5 years as per their MIS.

Probably as the error benefited you financially rather than cost you.

I then complained to Financial Ombudsman Service, who contacted me on 23rd January 2017, whereby I had to explain several times the nature of my complaint with Royal London. Within a week FOS upheld Royal London's decision, which I am completely baffled by as to how quickly the investigation was apparently carried out. I feel that nobody wants to make a decision against a large powerful company to my detriment.

This is a very easy decision for the FOS to make. Automatic risk reduction on investments is common place on fixed timescale investments. This would be in their published terms and it would only have taken the FOS 5 minutes to check with them.

The FOS would have access to your complaint, their response and any supporting material. It shouldnt take them long with an easy complaint like yours.

Also, The FCA do not allow complaints about investment returns. Any complaint on that basis would just result in a check that the right processes were carried out.

I think that Royal London have been negligent, by transferring my whole fund into a deposit account within two years, instead of over the last five years, which has negated any chance of fund growth during the last 5 years of the policy or am I wrong??

Doesnt matter. However, if you insist on it being correct, I am sure they will be prepared to accept the money you are willing to pay them back rather than keep the extra you have received.

I feel that Royal London are getting away with it because they know I have nowhere else to turn to. The big companies always win at our expense. Please help.

They are not getting away with it because you are better off because of their error. Yes, they made a mistake by shortening the risk reduction period but you are better off because of it.

Arkers

Is it just Royal London that are relatively poor maturity values?(obviously I know all about the projected shortfall red letters etc). One or two of the other posters seem quite happy with the values, and they do seem reasonable with all things considered.

I have an old GA/CGNU/ now Aviva policy due to mature next year, and although not cast in stone I have spoken to Aviva, and fingers crossed the final figure looks better then expected at the moment. This includes an MEP, does anyone have a recent experience of an old NU policy paying out and how it performed. DH has a Standard LIfe policy due in approx 18 months which doesn't appear to look as good. I would be interested in this too.

Arkers x

dunstonh

Is it just Royal London that are relatively poor maturity values?

Royal London is a company that has bought a number of old insurance companies over the years. They have a range of unit linked or with profits endowments on their books. The returns will be whatever the fund they invested in. A 100% equity fund for the life of the endowment may well have hit target. Whereas a WP fund that was forced to move from high equity to low equity for regulatory reasons would likely have a heavy shortfall. Most providers will have good, bad and average.

There are also target growth rates to consider. You could have two plans set up on the same day investing in the same fund covering the same term having different payouts. The difference could be the target growth rate on plan A was lower than plan B. Plan A could pay target and plan B could be in shortfall.

. This includes an MEP, does anyone have a recent experience of an old NU policy paying out and how it performed. DH has a Standard LIfe policy due in approx 18 months which doesn't appear to look as good. I would be interested in this too.

Many SL plans have an MEP too.