Act now on mis-sold endowments: new article

mayb_2 · 29 January 2008 at 11:49AM

forgot this one dunstonh in my last rave -

Figures indicate that around 1/3rd are mis-sales. However, that includes those that are not real mis-sales but where documentation is missing or inconclusive. So, why should the companies pay up on the other 2/3rds?

Because they probably were missales the companies time barred, lied about, falsified documents for or the poor people who owned them ,hadn't managed the process for making a claim very well. As for those with poor documentation, we are supposed to accept that those with lost or poor documentation were actually sitting there telling everyone exactly how it was at the point of sale? I don't think so. Then there are those thrown out by the Ombudsman service for the sort of reasons given to others of us on this site - inexplicable unless you allow yourself to doubt their motives.

efunc · 29 January 2008 at 5:11PM

Hello all,
I would be grateful for some general advice since I'm unclear whether or not I have grounds to complain having read all the relevant websites.

I was sold a 'Mortgage Manager' Endowment policy when I was 18 in my first year of college by Manufacturers Life in 1987. I didn't have a mortgage or any plan of getting one at the time but was told this would be the best way to save a bit of money. Since 2003 I've been receiving warnings of severe shortfall from Canada Life who have taken over ManuLife and my policy. The lump sum on maturity was going to be about £13,700, but at current projections will only be about £9,000.

My question is that all the information around seems to relate to the inability of the mis-sold policy to meet the cost of the mortgage. In my case I don't have a mortgage to pay off. Secondly, my policy was taken out in January 1987, a year before regulations began. Finally, my policy was taken with ManuLife but is now owned by Canada Life.

All these points cause me to doubt whether I've got grounds to seek compensation. Can anyone advise?

If not, should I just leave the policy in place, which will mature in 2012 or could I possibly do better by transferring it to something else?

thanks for reading!

mayb_2 · 29 January 2008 at 6:02PM

There are posts on this site from people who were sold something similar when they were in the forces and didn't have mortgages in place. I am not sure how you stand but the best first step is to look out all the paperwork you can find. Then if I were you I would go on the Which website and find the letter they recommend you send to your relevant company, which in your case is Canada Life. I don't imagine you can be time barred as it isn't with a mortgage but defenderoftheweak may be able to answer that one. Without something that says you will definately get such and such an amount you may be up a creek, as there isn't a mortgage that says look this is what I was expecting from this.

dunstonh may be able to tell you how the policy is really performing as opposed to the projections given by the company, as he appears to think they can differ tremendously and I suppose it will then depend on what you think.

It may be that this wasn't regulated and you will not be able to get anything done about it but it must be worth contacting the company.

When I had an endowment policy looked at by a Financial Advisor I was told that every penny I gave the company in premiums represented a loss to me and to cash it in immediately and stop throwing my money away. So you need to get it checked out. Perhaps ask them for the cash in value at some point so you have something to go on. There are always ISA's to put it in and at least you wont pay tax.

Best of luck,

TeeVee21 · 30 January 2008 at 12:19AM

Hi - can anyone offer any advice please? I took a mortgage on my parents council house in Jan 1999. It was only for £11000 and I got an intrest only mortgage with an endowment with the Halifax. This was taken on their advice. I have recieved an Amber letter from them and I was wondering if I have any case for having the mortgage mis -sold. At the time I was very niave about financial matters (I was 23) and put myself fully in their hands. To be honest I'm still pretty confused by it all!:o Thanks (The mortgage was taken over 15 years)

gardening_diva · 30 January 2008 at 9:10PM

My husband & I were missold endowment policies. The insurance company concerned has agreed and has offered compensation. However, when we compared their calculation method to that advised by the FSA there were obvious differences. We did a rough calculation ourselves & the figures looked to be a factor of 10 more than we had been offered.

We took this up with the insurance company who refused to budge - saying that the calculation was in line with FSA guidelines.

We took our complaint to the Financial Ombudsman Service. They have agreed that the comp was not calculated in the 'normal' way. However, they have said that if the comp was recalculated it **may** end up less than we were offered. Apparently the FOS is not in a position to actually tell us either way.

Now we have to decide whether to accept the original offer or ask the FOS to request the insurance company to recalculate, without knowing whether this is to our benefit or not! :mad:

Does anyone know of a way (preferably independant) that we can get this calculated once & for all?

Thanks!

mayb_2 · 30 January 2008 at 10:48PM

http://www.exasoft.biz/homepages/home.asp

The above is a link to the calculator for endowment compensation as recommended on the Which site. It probably costs £50 to use this but it might be well worth it to ensure you don't lose a lot more.

Good Luck!

mayb_2 · 30 January 2008 at 11:00PM

I suppose you could wait a bit and see what follows TeeVee21 - are they predicting a large shortfall to your mind? You don't start the time bar until after you get a red letter. I would be tempted to take on a repayment mortgage for some of the loan (the shortfall prediction) if you can afford it and either go for the misselling now or wait a while and see what happens next. Depends a bit on how much you are relying on this to repay that mortgage I suppose.

KKG · 31 January 2008 at 12:28AM

Hello. I bought an endowment policy from a company before the date agreed by the FSA for making claims about mis-selling (approx January 1988). The company [financial advisor/broker] subsequently went bust. My Aunty and Mum dealt with the broker/financial advisor in person as I was only 18yrs old at the time. The endowment is in my name, with my Aunty as a guarantor (who was due to retire well within the life of the endowment). The endowment was bought as a policy with which to pay off my mortgage. It was made clear that my aunty would be paying the monthly endowment payments throughout the life of the endowment policy. In addition the financial advisor/broker told them that the policy would definitely mature over and above the value of my mortgage. I know which road & town where the Company was, however, I have not been able to trace the Company's name. I understand I am eligible to approach the Ombudsman about this mis-selling, and would need the Company's name. The Policy paperwork only refers to the insurance company and not the original broker/financial advisor. How can I find out the broker/financial advisor company's name? What if i can not trace the name? Thanks for your help.

dunstonh · 31 January 2008 at 12:44AM

I understand I am eligible to approach the Ombudsman about this mis-selling

No you are not. The FOS eligibility applies to applications after 29th April 1988. If the firm you bought from no longer exists, the FOS will not review the complaint. The FSCS take on that responsibility but that didnt come in until a bit later in August 1988.

Your complaint would be to the advising company and if the company doesnt exist any more then you are out of luck as its pre-regulation.

multiman · 31 January 2008 at 5:13PM

I am confused!

I took out an endowment mortgage in 1986 and have recently complained to the company concerned that I was missold the endowment. The latest policy projection is for a shortfall of £5500 (at 4%). The policy has only 19 months to run to maturity. The company have upheld my complaint and offered me something called an indemnity certificate whereby they promise to pay the difference between the target figure to pay off the mortgage (£30k) and the eventual proceeds of the policy. I have to continue paying into the policy to qualify for this.

I have not seen this option being mentioned by other successful complainants who seem to have been offered immediate cash compensation.

My question is does this offer seem fair and could I ask the company for an immediate cash alternative? What is likely to be best for me? Also, they have given me the option of taking my complaint to the FOS but in dunstonh's last post he seems to indicate that I could not do that in view of the start date of the endowment.

Any comments gratefully received

Act now on mis-sold endowments: new article

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