Guardian Assurance Fined
Guardian Assurance was fined £750K last week by the Financial Services Authority (FSA), for its poor complaints handling procedures over this period.
The FSA said that the numbers of complaints made to Guardian about failed endowment policies, which were being rejected, rose from 29% to 77% after the company introduced new complaints handling procedures.
Guardian will now contact the 5,600 customers whose complaints were rejected during this period.
The company has also set up a helpline for customers with concerns, and said it welcomes their questions.
Ring 0845 701 0210 to speak to them.
Those of you who have managed to extract compensation from Guardian should revisit that comepnesation, and see if the amount is actually enough.
All of this extra expense, damage to reputation and hassle could be avoided if the life assurance firms finally bit the bullet and agreed to underwrite these useless and failing policies.
Monday, January 30, 2006
Thursday, January 26, 2006
Legal and General's Record Year
Legal and General's Record Year
Congratulations to Legal and General (L&G), the life assurance firm, who have announced record results today.
L&G new business has risen 29% compared with the previous year, to £1.3BN, as a result of strong demand for savings products and growth in personal pensions.
The 29% increase in new business was at the top end of analysts' expectations.
Sales also rose by 27%, in the final quarter of the year.
Tim Breedon, chief executive, said:
"This has been a year of remarkable growth for Legal & General. Our UK new business grew by almost a third in 2005 and our investment management business won a record £17.1BN."
Now if they could address the concerns of those of us with failing endowment policies, by underwriting these useless products, we would all be able to open the champagne bottles and toast their success.
Congratulations to Legal and General (L&G), the life assurance firm, who have announced record results today.
L&G new business has risen 29% compared with the previous year, to £1.3BN, as a result of strong demand for savings products and growth in personal pensions.
The 29% increase in new business was at the top end of analysts' expectations.
Sales also rose by 27%, in the final quarter of the year.
Tim Breedon, chief executive, said:
"This has been a year of remarkable growth for Legal & General. Our UK new business grew by almost a third in 2005 and our investment management business won a record £17.1BN."
Now if they could address the concerns of those of us with failing endowment policies, by underwriting these useless products, we would all be able to open the champagne bottles and toast their success.
Friday, January 20, 2006
Norwich Reduces Payouts
Norwich Reduces Payouts
Norwich Union have dealt a body blow to their long suffering endowment mortgage policyholders, who have been warned to expect a low payout this year.
This is despite the fact that Norwich's main profits fund achieved an overall return of 17.7% before tax.
A policyholder with a 25-year, £50 a month Norwich Union endowment mortgage maturing this month will receive 4% less than he would have done if the policy were to have matured in 2005.
Norwich stated:
"In general, shorter-term policies show increases or small decreases compared to equivalent policies maturing a year ago, while those with a term of 20 and 25 years will generally be lower."
However, Norwich Union went on to say that in many cases an increase is seen when the surrender value of the policy a year ago is compared to the maturity value now.
Well of course it would, surrender values are normally lower than maturity values!
Please don't treat your policyholders in such a patronising manner.
Norwich Union have dealt a body blow to their long suffering endowment mortgage policyholders, who have been warned to expect a low payout this year.
This is despite the fact that Norwich's main profits fund achieved an overall return of 17.7% before tax.
A policyholder with a 25-year, £50 a month Norwich Union endowment mortgage maturing this month will receive 4% less than he would have done if the policy were to have matured in 2005.
Norwich stated:
"In general, shorter-term policies show increases or small decreases compared to equivalent policies maturing a year ago, while those with a term of 20 and 25 years will generally be lower."
However, Norwich Union went on to say that in many cases an increase is seen when the surrender value of the policy a year ago is compared to the maturity value now.
Well of course it would, surrender values are normally lower than maturity values!
Please don't treat your policyholders in such a patronising manner.
Monday, January 16, 2006
Time Barring Petition
Time Barring Petition
Merryn Matt has set up an online petition calling for the practice of time barring to be ended.
Extract from the site, www.timebar.org:
"Did you know that the Financial Services Authority (FSA) has slapped time limits - known as 'Time Barring' - for compensation claims against Life Companies for endowment policies which may have been mis-sold?
Time Barring is unfair, unclear and misleading. Approximately 1 million of the UK's 7.5 million endowment policyholders may already be Time Barred from claiming according to the FSA.
These rules operate in favour of the companies that sold the policies - saving them and costing you millions of pounds.
How can this be right?
This petition calls on the Government and the Financial Services Authority to put an end to the confusion and dishonesty surrounding mis-sold endowment policies, once and for all."
I wish her well.
Don't forget to sign my petition though:)
Merryn Matt has set up an online petition calling for the practice of time barring to be ended.
Extract from the site, www.timebar.org:
"Did you know that the Financial Services Authority (FSA) has slapped time limits - known as 'Time Barring' - for compensation claims against Life Companies for endowment policies which may have been mis-sold?
Time Barring is unfair, unclear and misleading. Approximately 1 million of the UK's 7.5 million endowment policyholders may already be Time Barred from claiming according to the FSA.
These rules operate in favour of the companies that sold the policies - saving them and costing you millions of pounds.
How can this be right?
This petition calls on the Government and the Financial Services Authority to put an end to the confusion and dishonesty surrounding mis-sold endowment policies, once and for all."
I wish her well.
Don't forget to sign my petition though:)
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?
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?
Tuesday, January 10, 2006
FSA Tries To Clean Up Its Act
FSA Tries To Clean Up Its Act
The Financial Services Authority (FSA), stung by recent criticism of its poor litigation record, is now trying to clean up its act.
The FSA has created a new unit to 'stress test' enforcement cases, before they are taken to formal disciplinary review.
The new litigation and legal review unit aims to review the evidence and recommendations that the FSA's enforcement division puts before the Regulatory Decisions Committee (RDC), which makes the FSA's disciplinary decisions.
The change is not receiving unanimous support. One City lawyer warned that the unit could potentially "result in a bottleneck", and drastically slow down the disciplinary process.
The FSA's came under strong criticism during 2005, most notably after the rejection of its endowment misselling case against Legal & General by the Financial Services and Markets Tribunal.
FSA director of enforcement Margaret Cole said it was hoped that the new unit would result in more successful rulings before the RDC, by ensuring that cases were "effectively stress-tested before going before the RDC".
We shall see.
The most effective change that the FSA should make, would be to compel the life assurance companies to underwrite their useless and underperforming endowment policies.
The Financial Services Authority (FSA), stung by recent criticism of its poor litigation record, is now trying to clean up its act.
The FSA has created a new unit to 'stress test' enforcement cases, before they are taken to formal disciplinary review.
The new litigation and legal review unit aims to review the evidence and recommendations that the FSA's enforcement division puts before the Regulatory Decisions Committee (RDC), which makes the FSA's disciplinary decisions.
The change is not receiving unanimous support. One City lawyer warned that the unit could potentially "result in a bottleneck", and drastically slow down the disciplinary process.
The FSA's came under strong criticism during 2005, most notably after the rejection of its endowment misselling case against Legal & General by the Financial Services and Markets Tribunal.
FSA director of enforcement Margaret Cole said it was hoped that the new unit would result in more successful rulings before the RDC, by ensuring that cases were "effectively stress-tested before going before the RDC".
We shall see.
The most effective change that the FSA should make, would be to compel the life assurance companies to underwrite their useless and underperforming endowment policies.
Wednesday, December 14, 2005
The Pain of Mis-selling
The Pain of Mis-selling
It seems that it is not just the hapless owners of underperforming and useless endowment polices that are suffering, sometimes a little of the pain and misery caused by these useless products is spread around.
Mis-selling endowment policies has cost Lloyds TSB has £150M this year, that is in addition to the £360M already paid out in recent years for compensation claims over a variety of financial products.
Lloyds TSB is still reviewing the total cost of compensating its customers, but admitted that this could lead to an increased provision in the accounts.
In a trading update before its 2005 figures, Lloyds TSB revealed that it would also need to set aside another £150M to cover the cost on insurance policies of people living longer.
Lloyds TSB is not the only bank facing claims for mis-selling of endowment policies. HBOS has had to put aside £260M over the last two years.
Lloyds TSB warned that customers were continuing to have difficulty repaying their debts.
How can people be expected to repay their mortgage, if the policy that they bought to repay the mortgage doesn't work?
Analysts at Dresdner Kleinwort Wasserstein have described Lloyds as "strategically challenged". There is now speculation that it may be a takeover target.
What goes around, comes around!
It seems that it is not just the hapless owners of underperforming and useless endowment polices that are suffering, sometimes a little of the pain and misery caused by these useless products is spread around.
Mis-selling endowment policies has cost Lloyds TSB has £150M this year, that is in addition to the £360M already paid out in recent years for compensation claims over a variety of financial products.
Lloyds TSB is still reviewing the total cost of compensating its customers, but admitted that this could lead to an increased provision in the accounts.
In a trading update before its 2005 figures, Lloyds TSB revealed that it would also need to set aside another £150M to cover the cost on insurance policies of people living longer.
Lloyds TSB is not the only bank facing claims for mis-selling of endowment policies. HBOS has had to put aside £260M over the last two years.
Lloyds TSB warned that customers were continuing to have difficulty repaying their debts.
How can people be expected to repay their mortgage, if the policy that they bought to repay the mortgage doesn't work?
Analysts at Dresdner Kleinwort Wasserstein have described Lloyds as "strategically challenged". There is now speculation that it may be a takeover target.
What goes around, comes around!
Thursday, December 08, 2005
Backing For Scottish Endowment Compensation
Backing For Scottish Endowment Compensation
Opposition parties in Scotland have publicly committed their support to the campaign to secure compensation for thousands of Scottish homeowners, who were mis-sold endowment mortgages by their solicitor.
Charles Kennedy, Liberal Democrat leader, and Alex Salmond, SNP leader, urged the government to close a legal loophole which leaves many Scots facing huge shortfalls.
People who bought a policy through a lawyer in Scotland, before December 2001, do not qualify for a settlement under the Financial Services and Markets Act.
Mr Kennedy said:
"It is an absurd situation if people in Scotland don't have the same protection against endowment mis-selling as homeowners in England and Wales. It must be put right immediately."
Opposition parties in Scotland have publicly committed their support to the campaign to secure compensation for thousands of Scottish homeowners, who were mis-sold endowment mortgages by their solicitor.
Charles Kennedy, Liberal Democrat leader, and Alex Salmond, SNP leader, urged the government to close a legal loophole which leaves many Scots facing huge shortfalls.
People who bought a policy through a lawyer in Scotland, before December 2001, do not qualify for a settlement under the Financial Services and Markets Act.
Mr Kennedy said:
"It is an absurd situation if people in Scotland don't have the same protection against endowment mis-selling as homeowners in England and Wales. It must be put right immediately."
Friday, December 02, 2005
Scots May Get Compensation
Scots May Get Compensation
Scots who claim they have been mis-sold endowment mortgages, may finally be compensated.
They have taken their dispute to Westminster, where MPs have signed a Commons motion demanding an end to a loophole which currently means that Scots who bought policies through lawyers are not due any settlements.
The House of Commons Treasury Select Committee is also calling for urgent action.
Scots who bought endowment policies through solicitors before December 1 2001, do not qualify for compensation from the Financial Ombudsman Service.
This was the date when the Financial Services and Markets Act came into effect.
This also means Scots who were mis-sold endowment policies by lawyers before the 2001 deadline, can only receive £1K maximum payout set by the Law Society.
Scots who claim they have been mis-sold endowment mortgages, may finally be compensated.
They have taken their dispute to Westminster, where MPs have signed a Commons motion demanding an end to a loophole which currently means that Scots who bought policies through lawyers are not due any settlements.
The House of Commons Treasury Select Committee is also calling for urgent action.
Scots who bought endowment policies through solicitors before December 1 2001, do not qualify for compensation from the Financial Ombudsman Service.
This was the date when the Financial Services and Markets Act came into effect.
This also means Scots who were mis-sold endowment policies by lawyers before the 2001 deadline, can only receive £1K maximum payout set by the Law Society.
Thursday, November 24, 2005
Never Ending Debt
Never Ending Debt
According to the Office for National Statistics, approximately 600,000 people over 65 still have a mortgage. This figure means that 10% of pensioners are still paying mortgages.
Apparently many pensioners are remortgaging, at expensive rates, because of a shortfall on their endowment mortgages.
It seems that a lifetime of debt is what many owners of these useless policies have to look forward to.
According to the Office for National Statistics, approximately 600,000 people over 65 still have a mortgage. This figure means that 10% of pensioners are still paying mortgages.
Apparently many pensioners are remortgaging, at expensive rates, because of a shortfall on their endowment mortgages.
It seems that a lifetime of debt is what many owners of these useless policies have to look forward to.
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