Endowment Mis-selling - Don't give up!

Steve_f_4

thanks dunstonh.
i'd better get searching through all my old bits of paper for their details.
if they refuse to consider my complaint (last time i was told they were fed up with people whinging!) what do i do then? sorry to b so ignorant

EdInvestor

Steve

If the IFA rejects your complaint, refer it on to the Financial Ombudsman, who you can also call for advice on the whole procedure.

https://www.financial-ombudsman.org

dunstonh

It may not be an IFA ed and you are well and truely jumping the gun by mentioning ombudsman at this stage. Friends Provident did have their own salesforce. If it was a friends provident mortgage and friends provident endowment, then my guess would be that its a friends provident tied rep.

Steve, if you cannot find out who sold the policy to you, then Friends Provident can tell you. One phone call to them to ask if it was sold by an IFA or by someone from FP should suffice. If not FP, then ask the details of the advising company.

EdInvestor

Sorry, I had gathered FP had told Steve it wasn't them.

If they haven't Steve, then you should call them up and make them tell you whether the advisor who sold you the policy was one of their agents or an independent.

THe FOS can help if FP give you the runaround.

motis

I am seeking advice please re a settlement offer. Made to a relative by Abbey. I was asked to review it.

The offer was made as at a date in August saying "please reply within 21 days". I requested further information within that time (subsequently received). My relative has now accepted the offer via Abbey's form saying "full and final settlement".

1) Am I correct in thinking that the settlement offer is fixed as of the August date? (They said on the phone that acceptance was not required in 21 days, but that they were anxious to clear their books and a delay would mean they had to recalculate it. - ?)

2) I am expecting the settlement figure, plus a little interest on that figure due to the timelag between August and date of issue of settlement cheque (hopefully imminent). Is this correct and can I insist on such interest?

3) Can I (now) submit a charge for my financial advice which would be reimbursed by Abbey? This for reviewing the offer per FSA rules, together with discussing the wisdom or otherwise of switching to a repayment mortgage at this stage.

4) Re (3), If so, is there a reasonable charge for such service? (Not being a mortgage expert, it took a longer time, so my normal rate would be inappropriate.)

Many thanks in advance for any advice.

Mo

dunstonh

1) Am I correct in thinking that the settlement offer is fixed as of the August date? (They said on the phone that acceptance was not required in 21 days, but that they were anxious to clear their books and a delay would mean they had to recalculate it. - ?)

The date is mostly there to clear the books quicker. If complaint is upheld, then the offer generally stands a bit longer that. Indeed, I just got a client to agree to one that had been issued in July. Although, I have phoned the provider twice to let them know there would be a delay.

A recalculation may not be done. Indeed, it may result in a lower compensation figure if it was as the markets have performed well over the last 4-5 months.

2) I am expecting the settlement figure, plus a little interest on that figure due to the timelag between August and date of issue of settlement cheque (hopefully imminent). Is this correct and can I insist on such interest?

I wouldnt expect the interest on it. The delay in responding is the policyholder's responsibility, not the provider.

3) Can I (now) submit a charge for my financial advice which would be reimbursed by Abbey? This for reviewing the offer per FSA rules, together with discussing the wisdom or otherwise of switching to a repayment mortgage at this stage.

Only if you are FSA authorised can you attempt this. Some providers are willing to pay for costs incurred for switching from endowment to repayment when an IFA is used. If you are not FSA authorised, then you have broken the law so you wont get very far on this point.

4) Re (3), If so, is there a reasonable charge for such service? (Not being a mortgage expert, it took a longer time, so my normal rate would be inappropriate.)

Upto £300 is the Standard Life example and could be considered appropriate. However, the providers that do allow it will require the invoice/fee agreement, issued by the IFA, to prove that the cost has been incurred.

motis

Dear Dunstonh

Thank you very much. Could you direct me a little further please?

On recalculation, the FSA Handbook says: (Quote)

DISP App 2.2.3 The measure of any financial loss suffered by the complainant will be arrived at by:
(1) comparing the complainant's current capital position with the position he would have been in had the loan been a standard repayment mortgage as at the date the firm decides to regard the complaint as justified; and

(2) comparing the cost of the complainant's actual monthly outgoings and those he would have made had his loan been on a standard repayment basis as at the date the firm decides to regard the complaint as justified. (End quote)

Can you tell me which FSA rule overrides or is further to this please?

On the matter of interest on delayed payment, Norwich Union automatically included this in their end cheque to another relative. Logically because they they had had the benefit of the funds in the interim, as will Abbey have done, so to not pay such benefit across would be an unreasonable penalty wouldn't it?

Incidentally, I have provided information rather than advice (badly worded, sorry) - not guilty me Lud!

Thanks again
Mo

nationwide_3

I bought an endowment policy back in Jan 82, I was only 19 at the time.

I thought I was buying an endowment policy that would pay out at least £45,000.00 and was told by the seller that it would be more than this amount.

Over the years I have read about people receiving red, letters etc but I never received a letter so I thought my endowment was ok.

I did not realise at the time but what I had bought was a £22,000.00 endowment with a £23,000.00 life insurance that was only valid for the first 25 years.

The £22,000.00 part of the endowment policy is on track is going to make more than that.

My question is I was told when I bought this policy that it would definately pay out £45,000.00.

Can you advise me on what to do.

dunstonh

DISP App 2.2.3 The measure of any financial loss suffered by the complainant will be arrived at by:
(1) comparing the complainant's current capital position with the position he would have been in had the loan been a standard repayment mortgage as at the date the firm decides to regard the complaint as justified; and

(2) comparing the cost of the complainant's actual monthly outgoings and those he would have made had his loan been on a standard repayment basis as at the date the firm decides to regard the complaint as justified. (End quote)

Can you tell me which FSA rule overrides or is further to this please?

The important bit is "as at the date the firm decides to regard the complaint as justified."

So, they uphold the complaint and make the offer upto that point. Anything after that point doesnt need recalculation.

On the matter of interest on delayed payment, Norwich Union automatically included this in their end cheque to another relative. Logically because they they had had the benefit of the funds in the interim, as will Abbey have done, so to not pay such benefit across would be an unreasonable penalty wouldn't it?

Some providers may do, others may not. I doubt Norwich Union did it because they had benefit of the funds. They may well have benefited but it could have gone the other way. All I am saying is that they are not required to do it. If the compensation agreement goes back and then it takes longer than 30 days to process, the provider may well do it as they could be seen to be sitting on funds longer than is necessary and in those cases, interest is seen as a satisfactory way to settle the problem. If the form hasnt gone back, then its not the provider's problem.

motis

dunstonh wrote:

The important bit is "as at the date the firm decides to regard the complaint as justified."

So, they uphold the complaint and make the offer upto that point. Anything after that point doesnt need recalculation.



Some providers may do, others may not. I doubt Norwich Union did it because they had benefit of the funds. They may well have benefited but it could have gone the other way. All I am saying is that they are not required to do it. If the compensation agreement goes back and then it takes longer than 30 days to process, the provider may well do it as they could be seen to be sitting on funds longer than is necessary and in those cases, interest is seen as a satisfactory way to settle the problem. If the form hasnt gone back, then its not the provider's problem.

Thank you very much again on all counts - taken on board and understood, though brain hurting re the as-at date thingy. I'll let you know what transpires and hopefully you won't mind another question later if necessary.

Best regards
Mo