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Endowment 'miss-sold' by a Broker.

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Hi,
I April 1988 I took out a Mortgage Endowment Plan with Scottish Amicable through a local broker. I contacted Prudential who had taken over Scottish Amicable to see if I was due any compensation as a consequence of an expected shortfall of about £6000 when the policy matures in 2013. My understanding at the time of the purchase was that the policy would cover the loan and provide an additional lump sum. I understood also that I would be able to encash the policy early and cover my loan before retirement age based on anticipated growth.

After a number of letters and information exchanges PRU declared that the carried no responsibility in this particular instance as any advice I had taken was provided by a broker whom they described as ' not appointed by representatives of Scottish Amicable' but who indicated in writing that he operated within the guidelines set down by Scottish Amicable at the time.

The final letter from PRU in Feb 2006 suggested that if I couldn't get any compensation from the broker I should contact the Financial Services Compensation Scheme which I duly did. They pointed out that they didn't provide any compensation for miss-sold policies which were taken out before 28th August 1988; 4 months after my purchase.

Do I fall outside of all the compensation options or is there some other route I can follow???

Thanks.

Comments

  • dunstonh
    dunstonh Posts: 119,619 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    You took this out before regulation. Pru have no responsibility for the advice as they (or scot am) didnt give any.

    On the upside, Scot Am policies are usually quite good and have a high success rate of hitting target. Many of those with Scot Am policies that have complained and been successful have got nothing as the endowment has been the better option.

    So, whilst you cannot claim, its not all bad news. (scot Am hit target on 96% of endowments last year).
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • MMCC
    MMCC Posts: 6 Forumite
    Thanks for taking the time to reply. I figured that I had no route to compensation but your suggestion that Scot Am policies are quite good on making their target has brightened my day. Thanks!!!!!
  • dunstonh
    dunstonh Posts: 119,619 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Looked up the stats for Scot Am.

    In 2005. 95% hit target. In the 5% of cases — amounting to 815 Scottish Amicable policies — where there was a shortfall, the average was just £49.

    In 2006. The Scottish Amicable arm had 18,500 policies maturing and of these 96% exceeded their targets and produced an average surplus of £2600.

    A later release (which i cannot find) expected 100% target this year with £3300 as the average surplus.

    Most, of these would have shortfall projections, which is rather daft but there you go.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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