The Endowment Diary

The Endowment Diary

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The Endowment Mis-selling Debacle - one of the UK's worst financial scandals

Friday, January 13, 2006

Guardian Assurance Fined

Guardian Assurance Fined

Guardian Assurance and its associated company Guardian Linked Life have been fined £750K by the Financail Services Authority (FSA) for mishandling endowment complaints.

This is the fourth time that the FSA has fined an insurance company for mishandling complaints.

The FSA said that Guardian's complaints procedure had "serious systemic flaws".

As a result, 5,600 customers had their complaints wrongly rejected, and thus could have lost out on compensation.

Margaret Cole, the FSA's Director of Enforcement, said:

"Guardian failed to treat its customers fairly by exposing those with a valid complaint to the risk that their complaint could be rejected inappropriately.

Consequently, they may not have received the compensation to which they were entitled.

These failings exposed a high number of consumers to potential financial loss
."

The FSA role of shame:

-Friends Provident, December 2003, fined £675K
-Dunbar Assurance, March 2004, fined £725K
-Abbey National, May 2005, fined £800K

Between 1988 and 1995 Guardian sold 233,000 endowment policies, before it stopped marketing them.

It received nearly 20,000 complaints from April 2000 to the end of 2004.

At one stage it was rejecting more than three quarters of all its complaints.

I wonder how many other insurance companies are mishandling complaints?

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