MPPI - Do I have a case or no - Thread Deleted :(

saver861

magpiecottage wrote: »

But if it was only intended to say mean voluntary redundancy, it would have said so.

Well involuntary unemployment in the wider context covers everything. So, it excludes my case of early retirement. As I said before, my OH was just 50 at the time we took it out, so as such if she had been made redundant she would have been given full pension at that time. Therefore, she would have been excluded from claiming on that basis from the word go. We did not know this or at least it was not apparent. Maybe that's our fault or maybe we should have been better informed at the time of sale.

magpiecottage wrote: »

What I don't understand is why, if you believed you would be entitled to an ill health early retirement that would be sufficient for your needs, you took out the policy. Would you jump off a cliff just because somebody recommended it?

I'm not quite sure what your point is here? We have always been entitled to 'ill health retirement' i.e. at the time of taking out the policy, if a week later one of us had been taken seriously ill and unable to return to work, we would have gotten full pension on the basis of ill health. Indeed, it would have been a bigger pension as Ill Health added on years depending on the circumstances.

Redundancy retirement will pay the full accrued pension at the time of redundancy without any actuarial deductions.

So, I'm not clear what the question is that you are asking, but if you clarify I will be happy to respond.

Daniel54

OP. Having read all the original thread and this one,I think tthe point is that you make a much better case for misbuying than you do for misselling

saver861

Daniel54 wrote: »

OP. Having read all the original thread and this one,I think tthe point is that you make a much better case for misbuying than you do for misselling

Firstly - top marks for reading all the original thread - it was a long one!!!

I fully understand what you are saying - but this is the whole point about mis-selling. If we have bought the wrong product - is that our fault or that of the guidance we were given?

Insurance companies play on the fears of people - their duty is to sell their products without undue pressure or anything misleading.

So, if you could clarify your definition of misbuying, I'd be interested.

Daniel54

saver861 wrote: »

Firstly - top marks for reading all the original thread - it was a long one!!!

I fully understand what you are saying - but this is the whole point about mis-selling. If we have bought the wrong product - is that our fault or that of the guidance we were given?

Insurance companies play on the fears of people - their duty is to sell their products without undue pressure or anything misleading.

So, if you could clarify your definition of misbuying, I'd be interested.

I won't attempt a definition which lies outside my competence,other than to ask why as a clearly intelligent consumer you bought this insurance ?The terms of involuntary redundancy as they interact with your pension are not the norm.Most of us would be stuffed if we had been made redundant at your age and the insurance would be valuable.Even now you can make a claim but prefer not to.

If the sale was non advised,then only you and your wife knew the specific involuntary unemployment terms in your contracts/pension conditions

If it was advised,then did you share these salient facts with the advisor ?

(From memory it was unclear if this was advised or non advised)

You seem to be viewing this with 20/20 hindsight

saver861

Daniel54 wrote: »

I won't attempt a definition which lies outside my competence,

Well I put a guess at it that misbuying is a consumer buying a product not fit for purposes despite sound advice to the contrary.

Daniel54 wrote: »

other than to ask why as a clearly intelligent consumer you bought this insurance ?

ah ... now heres a poster that cearly knows what he's talking about ... right on bro

Seriously, I probably could answer that question better the day after we bought it than eleven years later. I'm not even going to go close to pretending I can remember the detail of a number of phone conversations that took place eleven years ago!

Daniel54 wrote: »

The terms of involuntary redundancy as they interact with your pension are not the norm.

If I can correct you - it is very much the norm for public sector pensions. Mine is the LGPS of which there are considerable numbers. Other public sector, civil service, NHS all have similar arrangements I understand.

Daniel54 wrote: »

Most of us would be stuffed if we had been made redundant at your age and the insurance would be valuable.Even now you can make a claim but prefer not to.

Well this is the point - our circumstances were very favorable at the time and we had considerable existing coverage. Hence was the insurance necessary for us at all? In hindsight, I say not.

I can make a claim for unemployment if I were to sign on and tell the Job centre that I intend to seek and return to full time work. That is not the case, primarily because of my pension and redundancy payout. However, I am excluded from claiming unless I meet the conditions of the job centre. My OH was in this position from the outset as she was 50 at the time but we were unaware, and thus we bought an insurance that was, in part, obsolete from the beginning.

Daniel54 wrote: »

(From memory it was unclear if this was advised or non advised)

Well I only became aware of these terms this week so I can't speak from knowledge on this. However, I gather from posters on the deleted thread that it is a non-advised. This would indicate that there is less requirement on the seller and thus the chance of mis-selling is reduced. However, I can tell you that I spoke with reps at Std Life to arrange the mortgage and insurance etc.

I think Magpie declared my case as non advised - though dunstonh stated that FOS has 99% non advised cases with 60% of them upheld. While most of these will be CC as opposed to MPPI, nonetheless it does seem a little bit conflicting that there is little onus on the non advised cases - yet 60% are upheld. If anyone can square that circle that would be cool.

Daniel54 wrote: »

You seem to be viewing this with 20/20 hindsight

Of course .... is that not the case in all of these situations .. or am I missing your point?.

Daniel54

Can't multiquote at the moment as working laboriously off a tablet on holiday.

Misbuying is an off the peg product where you know what you are buying but it turns out not to suit or fit you.But it may suit and fit me.So fit for my purpose but not yours

If you had bought a product bespoke for public sector employees in their 40's,then you would have a stronger case.Oddly enough,the majority of the population don't fit that description and the majority of the employed don't work in the public sector.So my statement does not need correcting

At your age I would have received 18 months money for redundancy,but at 55 would have had to take a 25per cent actuarial reduction in pension. As it happens I had decided not to buy MPPI .Why did you? If I had been made redundant,it would have been very handy

There are people on the boards seeking redress for missold life assurance,and it is pointed out to them that luckily they have not had to make a claim.So I disagree,misselling or misbuying,particularly of insurance,where the product is the claim,is about the point of purchase,not what has happened since.

saver861

Daniel54 wrote: »

.

Misbuying is an off the peg product where you know what you are buying but it turns out not to suit or fit you.But it may suit and fit me.So fit for my purpose but not yours

As in Mr X takes out a loan or mortgage, has no other policies, no illness or redundancy entitlements etc etc.

Mr Y on the other hand, has a number of other policies and other securities etc.

PPI appropriate for one, less so the other. Circumstances at time of sale determine whether both cases were dealt with appropriately.

Daniel54 wrote: »

If you had bought a product bespoke for public sector employees in their 40's,then you would have a stronger case.Oddly enough,the majority of the population don't fit that description and the majority of the employed don't work in the public sector.So my statement does not need correcting

If I can correct you again, I was saying that it is the norm in Public Sector. All public sector pensions have similarities and access to pension. However, public sector makes up about 20% of the working population, so clearly not the norm for the whole of the working population, to which you are of course correct.

Daniel54 wrote: »

At your age I would have received 18 months money for redundancy,but at 55 would have had to take a 25per cent actuarial reduction in pension.

I have got about 16 months take home pay in redundancy pay off with no actuarial reduction in pension.

Daniel54 wrote: »

As it happens I had decided not to buy MPPI .Why did you?

Well one simple reason might be that you are somewhat smarter than I am - and, if you are working in or related to the financial industry presumably much better informed than I.

In hindsight, it was an unnecessary insurance for us. There is no question I have given it considerable more consideration this last few days than I did at the time of purchase. The question mark here is whether I was unduly influenced at the time of purchase or not. Someone from Std Life sold us the product - now it may be they were on commission or it may be that it was irrelevant to their salary - I don't know.

Daniel54 wrote: »

There are people on the boards seeking redress for missold life assurance,and it is pointed out to them that luckily they have not had to make a claim.

Well as I mentioned previously, I currently have a valid claim now. It stands to pay me more, as well as continuing coverage, than if I had an upheld complaint with all the premiums and interest refunded. So in that sense this case is a little bit of a paradox. Most if not all cases stand to gain on an upheld complaint. Whoever so should thinketh this the same ..... perhaps they should've gone to Specsavers!!!

magpiecottage

saver861 wrote: »

I can make a claim for unemployment if I were to sign on and tell the Job centre that I intend to seek and return to full time work. That is not the case, primarily because of my pension and redundancy payout.

You don't have to simply stop working. Three members of my family have been made redundant in the public sector and chosen to take up other work whilst also receiving their pensions.

So your unemployment is voluntary - you have chosen not to work.

It is almost certain that you were asked when you would retire at the time you took out your mortgage. It is a basic question which would be asked to make sure the loan was repaid before then. If you said 60, or 65 or something else then that is what the adviser would have worked to.

Misbuying is when a buyer is responsible for purchasing a product which they know, or ought reasonably to know, is unsuitable for them.

If your purchase was not advised then I think it unlikely that FOS would think it reasonable not to have given specific information about the circumstances in which your particular pension scheme would provide an undiscounted pension in the event of redundancy. If that were necessary it would need to include every single pension scheme in existence. That is not a realistic expectation.

However, I gather from posters on the deleted thread that it is a non-advised. This would indicate that there is less requirement on the seller and thus the chance of mis-selling is reduced. However, I can tell you that I spoke with reps at Std Life to arrange the mortgage and insurance etc.

If so, I agree with Daniel54. The onus was on you to tell the adviser of the unusual benefits.

While most of these will be CC as opposed to MPPI, nonetheless it does seem a little bit conflicting that there is little onus on the non advised cases - yet 60% are upheld. If anyone can square that circle that would be cool.

There are several reasons. The first is that, as the saying goes, "your home is at risk if you do not keep up repayments on a mortgage or other loan secured on it". The stakes are generally higher than unsecured lending which, by definition, has no home for the borrower to lose.

In addition, any adviser will know a great deal more about the applicant - he will have a copy of the mortgage application detailing income, sick pay etc and probably a fact find.

If they show the information was incorrect then whose fault would that have been.

Of course .... is that not the case in all of these situations .. or am I missing your point?.

The point is that FOS will look at a case without the application of hindsight.

saver861

magpiecottage wrote: »

You don't have to simply stop working. Three members of my family have been made redundant in the public sector and chosen to take up other work whilst also receiving their pensions. So your unemployment is voluntary - you have chosen not to work.

Absolutely. I intend to work part-time. Indeed, I can work up to 16 hours and still make a valid insurance claim. The point is, it is not my intention to return to full-time work, which is the requirement of the insurance and one which we were not aware of.

magpiecottage wrote: »

It is almost certain that you were asked when you would retire at the time you took out your mortgage. It is a basic question which would be asked to make sure the loan was repaid before then. If you said 60, or 65 or something else then that is what the adviser would have worked to.

Yes - I'm sure we were asked that, I cannot remember such detail. Again, 60 or 65 would be retirement in normal circumstances, not redundancy as in my current circumstances.

magpiecottage wrote: »

If your purchase was not advised then I think it unlikely that FOS would think it reasonable not to have given specific information about the circumstances in which your particular pension scheme would provide an undiscounted pension in the event of redundancy. If that were necessary it would need to include every single pension scheme in existence. That is not a realistic expectation.

As stated earlier, 20% of employees are public sector all with similar pension schemes. So, if it is public sector, it's almost certain to have said benefits - thus not necessary to consider every single pension scheme.

magpiecottage wrote: »

If so, I agree with Daniel54. The onus was on you to tell the adviser of the unusual benefits.

Who is to say I did'nt - I very likely did. As you say, a mortgage adviser will know much more detail, we submitted all sorts of information at application, had several subsequent discussions, already had a mortgage with them etc etc. I simply cannot recall the detail of those conversations eleven years ago, and certainly can't prove anything one way or the other.

The point is, we still ended up with a MPPI and one which was obsolete for my OH for redundancy at the outset and for me now.

magpiecottage wrote: »

There are several reasons. The first is that, as the saying goes, "your home is at risk if you do not keep up repayments on a mortgage or other loan secured on it". The stakes are generally higher than unsecured lending which, by definition, has no home for the borrower to lose.

I really meant the upheld MPPI cases. My question would make more sense if we knew what percentage MPPI cases upheld were as 99% of them must be non-advised also. I understand the reason that MPPI claims have a lower success than CC claims, which all makes perfect sense, as mentioned before MPPI does have an appropriate place for many people.

magpiecottage wrote: »

In addition, any adviser will know a great deal more about the applicant - he will have a copy of the mortgage application detailing income, sick pay etc and probably a fact find.

Precisely - and in our case, in addition to all of that, they knew 60% of the mortgage was going to be paid off within a few months on the sale of our previous house. Yet - despite all of this, we still ended up with MPPI.

magpiecottage wrote: »

The point is that FOS will look at a case without the application of hindsight.

Yes - again, as I mentioned in the deleted thread, they will ascertain if sufficient information was given to the customer and if not, would the customer have made the same or different decision had all the appropriate information been given.

magpiecottage

saver861 wrote: »

Absolutely. I intend to work part-time. Indeed, I can work up to 16 hours and still make a valid insurance claim. The point is, it is not my intention to return to full-time work, which is the requirement of the insurance and one which we were not aware of.

That would seeem to be a complaint against the insurer rather than the seller.

Yes - I'm sure we were asked that, I cannot remember such detail. Again, 60 or 65 would be retirement in normal circumstances, not redundancy as in my current circumstances.

In which case the adviser would have met the standards considered to be good practice at the time if you had not volunteered that an immediate undiscounted pension was available on redundancy because it was an unusual provision (whether guaranteed or not).

As stated earlier, 20% of employees are public sector all with similar pension schemes. So, if it is public sector, it's almost certain to have said benefits - thus not necessary to consider every single pension scheme.

Incorrect.

It does not apply to the Police. (They could not be made redundant)

It does not apply to firefighters. (They are currently striking because, amongst other things, they will no longer be able to retire at 55 regardless of circumstances).

It does not apply to the NHS (I used to me a member) - although mental health nurses used to be able to retire at 55 anyway/

It does not apply to the Universities Superannuation Scheme.

It does not apply to the Principal Civil Service Pension Scheme.

It only applies to the Armed Forces pension scheme because of different rules.

It never applied to those schemes which were in the public sector before privatisation. For example:

British Gas

British Telecom

British Airways

Cable & Wireless

Water companies

Who is to say I did'nt

Who is to say you did?

I very likely did.

That is your opinion but it also seems to contradict your (incorrect) view that the benefits were common knowledge.

As you say, a mortgage adviser will know much more detail, we submitted all sorts of information at application, had several subsequent discussions, already had a mortgage with them etc etc. I simply cannot recall the detail of those conversations eleven years ago, and certainly can't prove anything one way or the other.

And that is the crux of the matter.

If I were assessing your case I would conclude that it was unsafe to uphold your complaint on the basis that the adviser ought to have known about the very specific redundancy benefits you thought your employer would provide because because you assumed it was common knowledge.

If you told the adviser and he recommended the policy anyway, you may have a case but you have no evidence that you did. I would therefore look at the records of the firm. If they showed that you did, that would point in your favour but if not then your assertion that you "most likely did" would fail.

The point is, we still ended up with a MPPI and one which was obsolete for my OH for redundancy at the outset

Arguably - but we still face the issue of whose fault it was that the adviser did not take account of it. As I say, unless you can show that you actually told the adviser it is more likely to be your fault than theirs.

and for me now.

That is only with the benefit of hindsight. If a complaint were upheld on that basis then any insurance that was not claimed on would be able to be complained about.

Precisely - and in our case, in addition to all of that, they knew 60% of the mortgage was going to be paid off within a few months on the sale of our previous house. Yet - despite all of this, we still ended up with MPPI.

I see three objections to this.

The first is that if 60% of the mortgage was to be paid off, that left 40% outstanding, for which a need would have been apparent to the adviser (if he was not told about the redundancy terms and I have seen no evidence that he was).

The second is that, unless and until the other loan was cleared and the mortgage reduced, the full amount was due.

The third is that there was nothing to stop you going back and reducing the cover when the amount of the loan (and thus the repayments) reduced. However, that amounts to a subsequent change in circumstances. The adviser cannot be held responsible for the consequences of that.

So, based on what I have seen, I would reject your complaint.