quick bit of info on Standard Life shortfall please

tom_and_barbara_good

We have 3 Standard Life endowment policies all due to finish along with our Halifax mortgage in 24 months, we have one amber alert and 2 red ones.

A few people that we have spoken to have said that SL seem to paint a very gloomy picture and when the finishing time arrives the payout is pretty good, maybe even quite close to the target amount, is this so?

dunstonh

SL do have a history of bumping up the maturity value but this is because their projections do not include terminal bonuses that have accrued to date.

So, if the target was £30,000 and the projection says £26,000 but the terminal bonus is £4,000 then it would pay out £30,000 on maturity (assuming no changes in the interim).

Its a flaw in conventional with profits plans and the projection method used.

tom_and_barbara_good

Thanks for that, do we have any way to find out or guesstimate the terminal bonuses?

tom_and_barbara_good

Bump - can anyone enlighten us about these teminal bonuses please?

dunstonh

Ask Standard Life how much the terminal bonus is currently.

agal

tom_and_barbara_good wrote: »

Bump - can anyone enlighten us about these teminal bonuses please?

My SL endowment finishes this summer. The Feb 2007 annual statement has the following figures;

Current value £24,045.20
Final Bonus £4814.95
Total current value on 1 Feb 2007 £28,860.15

The endowment originally had a target amount of £26,880.00

Hope this is useful to you.

dunstonh

So agal, you are on track with a few months to go for a surplus. However, it needed that final bonus to get you there and it is a bit of a farce that it isnt included in the projections.

twinstwins02

Standard Life endowment update 02/07 predicts a red alert shortfall of £7,800 - £8, 500.
Compensation received 3 years ago against this policy circa £1400.00 - How can shortfall have risen so much when stock market has been stable??

Can anybody help??
Is it permitted to make a second claim for compensation within the same policy??

silvercar

compensation is designed to put you in the position you would have been had you taken a repayment mortgage, it is not designed to make up the shortfall.

dunstonh

Is it permitted to make a second claim for compensation within the same policy??

You complained about not being sold a repayment mortgage and redress was paid to allow you to switch to a repayment mortgage. If you had paid the redress and the surrender value into the mortgage, you would not have had any issues.

You choose to keep the endowment and the risk that goes with that so you have no-one to blame other than yourself. This means you cannot complain again as you are responsible for choosing to keep it.

That £1400 was the amount of a potential shortfall. It was the cost difference between endowment and repayment.

As it happens, the shortfall may not be much different as SL have changed the projection rates used over the years and as mentioned higher up, they do not use terminal bonus accrued to date or the mortgage promise value in those projections. Most SL endowment increased quite a bit after the Feb bonus announcement.

EdInvestor

dunstonh wrote: »

If you had paid the redress and the surrender value into the mortgage, you would not have had any issues.You choose to keep the endowment and the risk that goes with that so you have no-one to blame other than yourself. This means you cannot complain again as you are responsible for choosing to keep it.

Amazing how posters are continually urged not to surrender their endowments, and then when someone takes this advice and loses out, what is the comment?

The poster gets the blame for taking a risk.