Endowment Claims Double
The Financial Services Authority (FSA) has doubled its estimate of how much firms have paid out in compensation for mis-selling endowment mortgages in the past, up to £2.2BN.
The FSA said the estimate is up to April 1, 2006.
The previous estimate of £1.1BN was up to the end of 2004.
Compensation payments have jumped sharply, £945M was paid in the year to April 1 with the number of complaints rising to 767,152.
In the year to April 1, 2005, compensation was £601M for 324,935 complaints. In 2003/04 compensation was £424M for 202,200 complaints, and before April 2003 compensation totalled £225M for 250,000 complaints.
Bradford & Bingley on Thursday announced its compensation provision would rise to £165M.
All of this pain could be avoided if the life assurance companies bit the bullet between their teeth, and agreed to underwrite these useless policies.
Monday, July 31, 2006
Thursday, July 27, 2006
Bradford and Bingley Hit By Claims
Bradford and Bingley Hit By Claims
Bradford & Bingley PLC today announced a larger than expected hit from endowment compensation claims by annoyed endowment customers.
Bradford & Bingley said that it was setting aside a further £89.4M, to cover the higher-than-expected number of complaints from customers who claim they were mis-sold endowment policies.
The total provisions now stand at £165.2M.
Bradford & Bingley CEO Steven Crawshaw said that he could not rule out further provisions in future.
Quote:
"It'd be a very brave person who would say that this is the last, but there are signs of light at the end of the tunnel."
Analysts at Keefe, Bruyette & Woods wrote in a note:
"The compensation claims for mis-selling are massive in relation to expectations and historical experience. While this should be a one-off, it is a negative for sentiment."
Bradford & Bingley also said underlying pretax profit, which excludes the endowment provision, came in at £164.2M in the six months to June 30, up 9% from £150M in the same period last year. Analysts had been expecting profit of £162.4M.
In my view a lot of heartache for those who bought these useless policies, and those who "manage" them, could have been saved if the life assurance companies simply underwrote them.
Bradford & Bingley PLC today announced a larger than expected hit from endowment compensation claims by annoyed endowment customers.
Bradford & Bingley said that it was setting aside a further £89.4M, to cover the higher-than-expected number of complaints from customers who claim they were mis-sold endowment policies.
The total provisions now stand at £165.2M.
Bradford & Bingley CEO Steven Crawshaw said that he could not rule out further provisions in future.
Quote:
"It'd be a very brave person who would say that this is the last, but there are signs of light at the end of the tunnel."
Analysts at Keefe, Bruyette & Woods wrote in a note:
"The compensation claims for mis-selling are massive in relation to expectations and historical experience. While this should be a one-off, it is a negative for sentiment."
Bradford & Bingley also said underlying pretax profit, which excludes the endowment provision, came in at £164.2M in the six months to June 30, up 9% from £150M in the same period last year. Analysts had been expecting profit of £162.4M.
In my view a lot of heartache for those who bought these useless policies, and those who "manage" them, could have been saved if the life assurance companies simply underwrote them.
Tuesday, July 18, 2006
Claims Firm Collapses
Claims Firm Collapses
As if things were not already bad enough for the millions of people stuck with underperforming and useless endowment policies, 6000 now face the added burden of having paid money to a claims firm that has been wound up by the DTI.
6000 people whose endowments failed paid £495 upfront to a claims company, Manchester-based Vickers Anderson Consulting.
It is unclear as to whether they will be able to get their money back.
What a mess!
As if things were not already bad enough for the millions of people stuck with underperforming and useless endowment policies, 6000 now face the added burden of having paid money to a claims firm that has been wound up by the DTI.
6000 people whose endowments failed paid £495 upfront to a claims company, Manchester-based Vickers Anderson Consulting.
It is unclear as to whether they will be able to get their money back.
What a mess!
Wednesday, July 05, 2006
250 A Day Habit
250 A Day Habit
The Financial Services Ombudsman (FSO) announced that it received 250 complaints a day last year about endowment mortgages.
Walter Merricks, the chief ombudsman, said that there were indications that the "extraordinary high volume" of complaints about endowment mortgages was levelling off.
The Financial Services Ombudsman (FSO) announced that it received 250 complaints a day last year about endowment mortgages.
Walter Merricks, the chief ombudsman, said that there were indications that the "extraordinary high volume" of complaints about endowment mortgages was levelling off.
Saturday, July 01, 2006
Words of Wisdom
Words of Wisdom
There are some words of wisdom in the FT for holders of Standard Life with profits policies.
There are some words of wisdom in the FT for holders of Standard Life with profits policies.
Subscribe to:
Posts (Atom)