Aviva - Mortgage Endowment Promise is 'not applicable'

Jaybee101

Thanks for the comment,

I have paperwork from NU in 03 saying I qualify for MEP yet AVIVA 2010 Red Alert letter says no I don't qualify but because of valuation in 99 not because of fund switch.

None of the paperwork I own mentions loss of MEP if funds are switched, that's my complaint. If it had said this I would not have switched.

My IFA was given statements received from NU in 05/06 (when he decided how we'd switch the funds) and that does not mention loss of MEP either so how could he know?

My beef here is that this large loss of funding was buried in terms and conditions, not re-issued at the time of the fund switch and ultimately neither I nor my IFA picked up on this. How could we be expected to?

Such a major impact on final value buried in t&c's we may have received 10 years before? How could we be expected to know about that. Of course it was in NU's interest to keep this quiet!

freem17

I would firstly request copies of all your projections going back to 99 - they may not actually be able to produce a copy of the 99 one only a calculation of the figures (which may go in your favour if they don't have the original to show wether the conditions were included) Requesting this will at least show if you had a shortfall on the qualification date. It is odd your 03 one says you qualify but then 2010 says don't (but not due to the fund switch) Have you got any projections from 2001/2002 ? It's worth a try with the complaint but i feel they will be able to provide some form of evidence that the conditions would have been sent at some point in time. We always had to go through the conditions over phone if a customer even in passing mentioned the mep - they weren't allowed off the phone until we'd rammed them down there throat !!

Jaybee101

Hi,

Thanks for the tips. Have spent all morning going through our paperwork, reams and reams of the stuff.... nothing from 01/02 though. Here's the conclusion we've reached:

1. The MEP/"Policyholder's Promise" is only mentioned once. In a computer generated "You're Endowment is not going to do what you expect" type A4 leaflet with a 4%. 6% & 8% projection. Under which it mentions we may get up to £12k under the Policyholder's Promise.

2. It is not mentioned at all on any annual statement (just about the only communication we'd get once a year from NU). The statements just detail the fund value and units bought over the preceding 12 months.

3. We have copies of the Switch Funds forms. It's not mentioned on there either.

Sounds like we would have been better off doing this on the phone! Had anyone mentioned the MEP might be at risk it would have been a no-brainer to not switch funds. As it was, NU took two goes to actually do the switch (somebody was trying to tell me something I think....;)) and I remember it took three phone calls to even get the right forms sent out. Nobody seemed to understand what form needed to be used.

If I was a conspiracy theorist (which I'm not, we're all human and people and process are subject to error) I'd say NU introduced MEP/PP in 2001 under pressure after the first Endowment underperforming stories broke and kept this as quiet as they could!

As mentioned in a prior post, after the successful switch on the 2nd attempt NU actually (in error as borne out by Financial Ombudsman's judgement) suspended our policies and six months later told us we were in arrears (while continuing to take monthly DDs). That took two years of complaints and two ex-gratia payments to sort out. It was a computer !!!!-up of a large magnitude. We slipped down a crack and the policies were effectively dead until the FO stepped in and all was put "right" (I have no actual way of knowing this of course...). During this period the paperwork sent and received was enormous as were the phone calls I had on an almost monthly basis with NU customer services. Never in any conversations, nor one one scrap of those letters was MEP/PP mentioned.

The fact that after holding this policy since 1995 I've only, this week, in 2012 while reviewing financials and courtesy the other posts on this very forum, become aware that a MEP/PP ever existed on our policy(!!) is evidence enough that this was never explained properly nor even notified to us, nor was our very qualified IFA aware of this consequence when he recommended we switch some funds :mad:

Couple this with two disparate reasons given for non qualification and I think I need to take this a lot further. All in all, my experience with an NU/AVIVA Endowment has not been a happy one thus far.

brewerdave

I actually received £4400 under the NU "promise" - this morning I had a look back thru my paperwork - as far as I can see, the actual individually calculated max. amount, appeared in my annual statements/paperwork until November2004, then vanished!
Fortunately I had kept all the paperwork back til the early 90s so was expecting the final payout to include the extra,which it did - still would have left me with an £8k+shortfall,if I hadn't already paid off the mortgage.

Snowflake

I know nothing about finance but for interest's sake I can tell you a little story. I consulted with an IFA last month and was quite excited about the prospect of cashing in my endowment ( NU/Aviva WP ) which has 2 years to run paying off my mortgage also 2 years to run, as he said it was a 'no brainer'. We are not talking huge sums here and I felt uneasy about subsequent payments to said IFA.
I rang Aviva myself and was informed that I had a guaranteed bonus on maturity which I would forfeit if I surrendered it now.I think the IFA may have missed that too so I have dispensed with his services and however much I would like the extra cash now I think I need to wait cos in my book £8000 is a lot to lose.

dunstonh

Snowflake wrote: »

I know nothing about finance but for interest's sake I can tell you a little story. I consulted with an IFA last month and was quite excited about the prospect of cashing in my endowment ( NU/Aviva WP ) which has 2 years to run paying off my mortgage also 2 years to run, as he said it was a 'no brainer'. We are not talking huge sums here and I felt uneasy about subsequent payments to said IFA.
I rang Aviva myself and was informed that I had a guaranteed bonus on maturity which I would forfeit if I surrendered it now.I think the IFA may have missed that too so I have dispensed with his services and however much I would like the extra cash now I think I need to wait cos in my book £8000 is a lot to lose.

The IFA was wrong to give that advice. So, you have grounds for complaint against the adviser.

Advice is not just about when taking a product out but also advice on products running.

Aviva dont go out of their way to let you know the MEP exists. So, it is almost certain the adviser didnt know it existed. However, they are not the only provider to do something like this and it should be an automatic question to the provider when writing off to get details to see if something like this exists. If Aviva, in their response to him, didnt supply the information despite being asked, then the complaint should be directed to them.

If the surrender has only recently happened, there is the potential that Aviva will reinstate the policy with a health declaration and you paying the missing premiums. The front line service team may well tell you that you cannot do this but the back office where discretion on things is often greater may well do it (not saying they will but many insurers will have a period where reinstatement is possible).

i suggest you message the aviva rep higher up on this thread. Point them to your question and my response and see what they say. I cant promise they will offer this facility but Aviva, for all their admin issues, do tend try their best to be helpful where a genuine error has occurred.

Snowflake

Thank you Dunstonh. I appreciate your comments.

necta

Hi I have a Whole of Life with profits policy. I want to calculate how much is it worth today. Can anyone tell me what the 2012 terminal bonus sum is per £1000 of basic sum assured. thanks

dunstonh

Can anyone tell me what the 2012 terminal bonus sum is per £1000 of basic sum assured.

Aviva can. No-one else can as it would depend on timescales and what version product you have.

docrow

Necta, call aviva,:money: 08009531777
they will tell you quickly politely and easily.
What you do with the info is more difficult:(

Doc