The Endowment Diary

The Endowment Diary

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

Monday, March 19, 2007

Standard Life

Standard Life

In rather a curate's egg development, Standard Life is due to write to its 750,000 endowment policy holders informing them that their endowments may not pay off their mortgages.

However, Standard Life will attempt to sugar the unpleasant pill by telling its hapless policy holders that the shortfall may not be as bad as it was anticipated a year ago.

So that's alright then!

It is estimated that around 90% of Standard Life's policies are not on target to meet the debt that they were meant to cover.

A Standard Life spokesman said:

"For many customers, a small shortfall will not present a problem, as these consumers have already paid off the mortgage, and were holding on to their policies for savings purposes. Others may be fully aware of the position of their contract, but have other savings to make up the shortfall, and so be comfortable with the situation."

I find the logic of the above to be highly dubious. Was not the point of taking these useless policies out to cover the mortgage?

Therefore how can a policy holder be "comfortable" with a shortfall?

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