Are Reliance Mutual Plans Paying Well?

Crazy_Saver

Many moons ago, we were advised to surrender a couple of Reliance mutual endowment policies. The FA then sold us another policy with Eagle Star.:mad:

Could anyone tell me how Reliance Mutual plans are doing in the present climate?

I have read a lot on these threads that quite a few companies have picked up now and many policies are now reaching target and some are even beginning to show surplusses.

I'm just curious to know if we would have been better off staying with Reliance Mutual, as I'm sure they would be hard pushed to have the shortfall that Eagle Star are predicting!!!

Thanks Guys.

As always, ever grateful...........Crazy Saver

EdInvestor

What an absolute bummer :mad: :mad:

You will just spit when you see the state of play now.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/05/12/cmendow12.xml

Reliance are at the top of the table.And guess who is at the bottom?

Complain NOW.The basis for the complaint is "churning".

Crazy_Saver

EdInvestor wrote: »

What an absolute bummer :mad: :mad:

You will just spit when you see the state of play now.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/05/12/cmendow12.xml

Reliance are at the top of the table.And guess who is at the bottom?

Complain NOW.The basis for the complaint is "churning".

Oh my God! How unlucky can one get:mad:

The case is already with the FOS but they are siding with the FA. FOS say that it's quite likely we approached the advisor with the veiw of surrendering our policy! That is so untrue!

The truth is that there is no evidence at all regarding surrendering the original policy. The advisor made no effort at all to contact Reliance Mutual except to get a surrender value. FA is saying that we needed the surrender money and without it, our move couldn't go ahead!

Absolute Bull !!!!!

We actually didn't receive the money until 3 months after we had moved!!!

The FOS is also claiming that we probably chose to surrender because the policy was performing badly which is reflected in the low surrender value. Admittedly, we made a substantial loss and received less than we paid in, but that was because it was within the first five years therefore carrying early redemption penalties:mad:

Life seems so unfair:o

Crazy_Saver

This may be a ridiculous question, but here goes.

We went to the FA for advice on remortgaging.
FA told us to surrender two existing endowment policies and take out a new one.
New one failed badly but surrendered ones showing surplus.

Is the FA in any way responsible for the difference in financial outcome?

Thanks.........Ever hopeful.........Crazy Saver

dunstonh

Is the FA in any way responsible for the difference in financial outcome?

Not necessarily.

I am very active in pension transfers and there are a couple lines that go in the suitability report which protect my backside. "there is no guarantee that the new plan will outperform your existing one or any of the other alternatives".

No-one knows what the future holds and options that are good today can be disasters later on (and vice versa). If the adviser has documented that the recommendation was based on future potential or even lower charges (the official bodies seem to prefer people to invest in lower charged products even if the returns are not as good!) then he has covered his rear end.

Eagle Star used to have some very good policies in the past and looking back, the Eagle Star brand was stronger than Reliance Mutual. Today, ES has been gobbled up by Zurich and has mostly vanished. Shame really as I have good memories of it. Unlike Zurich who I am no fan of.

EdInvestor

Crazy_Saver wrote: »

This may be a ridiculous question, but here goes.

Not ridiculous at all.

We went to the FA for advice on remortgaging.
FA told us to surrender two existing endowment policies and take out a new one.

Why?What was the reason?

New one failed badly but surrendered ones showing surplus.
Is the FA in any way responsible for the difference in financial outcome?

He is if there was no good reason for his recommendation. Some advisors made recommendations like this so that they could get additional commission. This is called "churning" and it is a type of misselling.

If he churned your policies then he is liable.

See example no 3

Crazy_Saver

dunstonh wrote: »

Not necessarily.

I am very active in pension transfers and there are a couple lines that go in the suitability report which protect my backside. "there is no guarantee that the new plan will outperform your existing one or any of the other alternatives".

No-one knows what the future holds and options that are good today can be disasters later on (and vice versa). If the adviser has documented that the recommendation was based on future potential or even lower charges (the official bodies seem to prefer people to invest in lower charged products even if the returns are not as good!) then he has covered his rear end.

Eagle Star used to have some very good policies in the past and looking back, the Eagle Star brand was stronger than Reliance Mutual. Today, ES has been gobbled up by Zurich and has mostly vanished. Shame really as I have good memories of it. Unlike Zurich who I am no fan of.

Thanks for that dunston.

FA never documented anything about new plan outperforming old ones, although has really overdone the "cost was paramount" bit in her notes. This is such an exaggeration of the truth!

I have contacted Reliance Mutual asking if they could give me an idea what the premiums would have been if the FA had at least contacted them asking for a top up instead of surrendering. Maybe we'll have a case if they come back as favorable in comparison to the policy that were were advised to take.

Crazy_Saver

EdInvestor wrote: »

Not ridiculous at all.

Why?What was the reason?

He is if there was no good reason for his recommendation. Some advisors made recommendations like this so that they could get additional commission. This is called "churning" and it is a type of misselling.

If he churned your policies then he is liable.

See example no 3

Hi Ed.

As I mentioned before, am trying to claim churning but FOS adjudicator says that it's possible that it was our decision to surrender the policies not the FA! there is no evidence at all to suggest this so have asked for case to be passed to an ombudsman.

P.s., this quote button is very clever. How did it work out about example no 3...Saved me an awful lot of typing though

Regards
Crazy Saver

EdInvestor

http://www.financial-ombudsman.org.uk/publications/guidance/mtge_endowment_redress_cs.htm

Case no 10 may also be worth a read.

Crazy_Saver

EdInvestor wrote: »

http://www.financial-ombudsman.org.uk/publications/guidance/mtge_endowment_redress_cs.htm

Case no 10 may also be worth a read.

Thanks for that Ed.

Point 10 is exactly what happened to us. Although proving it is another matter. Why do some things come so easily to other people?


Crazy Saver

EdInvestor

Crazy_Saver wrote: »

Point 10 is exactly what happened to us. Although proving it is another matter. Why do some things come so easily to other people?

You are not required to prove it.The company who sold it is required to show that the sale was fair.Often, if the sale was done by a big company tied advisor (or a bank acting as an agent for the insurer) , the file will have been destroyed, and the company won't be able to defend its case.

Hence the policyholder wins by default.

Using an IFA is supposed to protect you from misselling because you can go through the complaints mechanism, but often we find either that the IFA has conveniently moved onto a new company leaving the liabilities for misselling with a bankrupt shell - so you get nothing - or the IFA completely refuses to uphold the complaint ( whether it is fair or not) and defends the claim down to the wire often managing to persuade the staff at the Ombudsman (which is staffed mainly by people who formerly worked in the industry).

In many cases it looks like the luck of the draw plays the biggest role.