Norwich Union Endownment Policy - Advice needed :(

Babbler

My mum has asked for help - not sure if anyone has had the same problems:

In 1988 advice was given to her by Medical and Executive insurance brokers to take out the policy with Norwich Union - they were not authorised to give advice at that time. Norwich Union paid them a fee at that time.

Norwich Union confirms initial comission of £1,230.22. - Total comission amounted to £2,969. My mum has an S.I.B number.

Norwich Union claim my mum is not entitled to anything! The FSCS can only consider a claim if the firm that gave the advice was authorised to do so by the relavant regulator.

Has anyone had experience of this and can my mum get her money?? How can Nowich Union get away with paying them and then claim we dont deserve anything?

Any help appreciated.

dunstonh

How can Nowich Union get away with paying them and then claim we dont deserve anything?

NU have no liability as they had nothing to do with the sale. They just received an application in the post one day and they set it up on that basis. They never spoke to your mum and never advised you mum. It would be unfair for them to have to pay anything to your mum because of someone else.

NU paid them for introducing the business to NU.

Babbler

Thanks - but how can she not get anything for the endownment now? Surely she must get something?


Im don't really understand endownments, but is seems a bit strange...

dunstonh

Thanks - but how can she not get anything for the endownment now? Surely she must get something?

It will still pay out a value on maturity. The value is not a fixed amount but variable. In the old days of boom/bust and higher inflation, endowments always paid a surplus. These days of low inflation dont work for the structure of endowments and the amount being paid out is lower. We also had a stockmarket crash a few years back which really compounded the issue.

So, she will still get a payout but the amount may not hit the target and she needs to prepare to cover that potential shortfall. There may be alternative investment funds available on the endowment which may offer greater potential than the one she is in.