Standard Life Endowment Problem

samsyerman

I have been following all the threads with interest and in some cases genuine disbelief with regards to some of the antics of the big insurance companies.

I would like to give some details of my own problem with Standard Life and hope that someone will be able to give me some advice.

I took out a Low Cost endowment plan with SL in November 1987, maturing in November 2005.

Target amount £11450.

I got all the usual information down the years about how well the plan was performing and then in 2003 they wrote to say there was a possibility the plan may not pay off the target amount. However they had informed me of a "promise" to pay of the target amount at maturity. That was in 2000, but now they have reneged on that as well.

In 2004 my plan summary was as follows.

Total Current Value at 1 Feb 2004 £9453.80 (includes Final Bonus of £915.50)
Min amount at maturity £9765.79

Now in 2005 after paying my premium of £30.43 per month (another £365.16 in the year) the figures are

Total Current Value £9422.10 ( final bonus now £137.80)
Min amount at maturity £9800.62

So I have paid £365.16 in premiums and my current value has dropped and my minimum amount at maturity has increased by £35.

Something is definitely not right in the state of Denmark.

When I rang Standard Life to ask about these figures they referred me to the documents enclosed regarding the factsheet from the FSA.

I then went on to ask them about the proposed demutualisation in 2006, which I had hoped would give me a small windfall to set against my expected shortfall. I was dumbstruck when the girl at SL said "Oh you will not be a member in 2006 when we demutualise and therefore will not be entitled to any shares".

I had thought that as they had set a date in 2004 after which anyone who bought a SL policy could not benefit from the windfall, then those who were SL policyholders at that time would qualify for a windfall.

Apologies for the length of this thread but I am getting very close to the time when my policy is maturing and I would be very grateful for any help.

A worried and angry SL policyholder.

samsyerman

EdInvestor

Hi Sam

It's hard to know what to say about this one. As you can now see, you would have been better off if you left last year when there was still a chunk of TB worth having, which has now almost gone.

It's correct you won't be eligible for a DM bonus

The decision is really whether to go now and take the small amount of TB and save the rest of the premiums or to wait until maturity and hope they take pity on you and award you a small TB.

I'm sorry I can't be more helpful.

Were you aware that the policy was not guaranteed to pay off the mortgage?Did you know the money was invested in the stockmarket? If not you could make a misselling claim, though it would only be likely to succeed if you bought it from a BS or a bank - not via an IFA.

angela110660

So awful that you are in such a position at this late stage. Very difficult to know what is best to do now.
Personally , our SL endowment does not end until 2018 but still feel very pessimistic. Have had the plan since 1993 paying in the same premium and look at the value and how it has dropped:
Value 2003 £8525 (after 10 years at £999 per year!)
Value 2004 £10342
Value 2005 £11696
2003-4 was not so bad but this year have just about come out evens! Very depressing. Think the first figure was bolstered up by the promise thingy which they have now pulled. Will do as "editor" suggested on another thread and hang on till they demutualise next year to decide whether to continue or not.

Compensationitis

Ask an IFA how much 'accrued terminal bonus' is on the horizon, on Monday this week Standard Lamp agreed to provide the information to IFAs only after being hit around the head with a few newspapers. For some reason direct customers will still be left in the dark.

TB has NOT vanished it is simply being hidden from view for reasons only known to the strange people we are told are actuaries.

Complaints in with Standard and the FSA about this, it is VERY MISLEADING!!

EdInvestor

TB has NOT vanished it is simply being hidden from view for reasons only known to the strange people we are told are actuaries.

I wish I could agree.

But realistically the TB money has gone.It was lost in the stock market crash in 2001-02. If our old management had acted like the Pru and put more of the WP money in bonds in 2001 rather than punted it on the market,we'd be a lot better off.

But they didn't.
There's no point in crying over spilt milk.

dunstonh

Editor wrote:

I wish I could agree.

But realistically the TB money has gone.It was lost in the stock market crash in 2001-02. If our old management had acted like the Pru and put more of the WP money in bonds in 2001 rather than punted it on the market,we'd be a lot better off.

But they didn't.
There's no point in crying over spilt milk.

No it hasnt.

This explains how Standard Life endowments have been projecting shortfalls but have gone on to provide surpluses at maturity. The terminal bonus isnt switched on or off either. It is paid depending on the start date and the length of policy. Earlier policies will still have some terminal bonus and you are likely to see terminal bonuses rise again in the coming years (at the expense of annual bonuses which are likely to remain low).

EdInvestor

Dunstonh

Perhaps, as a public service - being an IFA - you'd like to test this theory by acting on Samsyerman's behalf and checking on the likelihood of him getting a TB larger than what he has at the moment at the end of this year.

I would hate to mislead Standard Life Moneysavers, and I'm sure you take the same view.

The FSA's latest remarks on intermediaries and PPFMs may be helpful.

Michel_Z.

Editor wrote:

Dunstonh

Perhaps, as a public service - being an IFA - you'd like to test this theory by acting on Samsyerman's behalf and checking on the likelihood of him getting a TB larger than what he has at the moment at the end of this year.

I would hate to mislead Standard Life Moneysavers, and I'm sure you take the same view.

The FSA's latest remarks on intermediaries and PPFMs may be helpful.

I take the same view :T

dunstonh

I am happy to check any forum members standard life policy if they want me to. I have already done it for a number of forum members.

samsyerman

Dunstonh

I have sent you a PM.

samsyerman

Shorty

I have been reading your threads with great interest. What a knowledgeable bunch you are. Perhaps you would be so kind as to help with my little problem. I too took out a Standard Life endowment in 1993. Presumably I will not be eligible for a payout if SL demutualise. I have contacted a company with regard to selling the policy who have told me they do not buy unit linked polices. Is this the case across the board therefore my only option being to surrender the policy to SL.