How do you know and how can you prove if you have been mis-sold an endowment policy?

Answer 1

When you were sold the policy, you should have received a letter setting out how it works, what the risks were and why it was appropriate for your needs. If you didn't get one, or if it was untrue, the policy was missold.

If your policy was part of a mortgage deal, the letter (if you got one) should have pointed out that there are other ways or repaying a mortgage and that there was a risk that there might be a shortfall (i.e. the policy would not pay off all the mortgage).

If you have any concerns, write to the organisation who arranged the policy and tell them. It's up to them to prove that it was sold correctly or to pay you compensation if it was not. However, there are time limits and you should act quickly. If you're not happy with what they have to say, you can go to the Financial Ombudsman Bureau. www.financial-ombudsman.org.uk

Don't bother using one of the claim chaser companies. They can't do anything you can't do yourself, and they'll want a share of your compensation.

Answer 2

All endowment policies taken out in the late 80's/early 90's are likely to be showing a shortfall of between 10% and 20%. The people you are with should have sent you a couple of letters warning you about this. They also should have sent you a phone number to call if you think you were mis-sold this policy. My policy is likely to be at least £4,000 short when it matures in 10 years time. Last year I phoned the people and they sent me a form to fill in - it asked various questions like:
When did you take the policy out?
Was it through an independent financial advisor or a mortgage advisor?
Do you still have the mortgage secured on the property?
Did the advisor ever say that the final amount may not be enough to pay off the mortgage? (if not, then you are virtually guaranteed to get some money back)
I spent 1 hour filling out the forms and they said I could either accept a cheque payment of just over £1000 if I signed that this was acceptable to me, or if I didn't think this was acceptable we would both have to argue things out with the insurance ombudsman. They said I might get more or I might get less than this - I took the cheque that they offered me! There are several companies that do a "no win no fee" for endowment claims, but they take around 30% of the final settlement fee. I would advise you to contact the endowment people and fill in the form - you are likely to get a compensation cheque from them! Luckily, I realised that the endowment policy wasn't likely to pay off my mortgage and when I moved I took out a repayment mortgage and kept the endowment on as an investment. I did this about 5 years ago, so I think that's why they didn't offer me as much compensation.

Answer 3

Well the easiest way to prove that you had been mis-sold a policy is when you have a documented conversation (of your discussion). Normally, sales people keep a memo file documenting what you have agreed, this is signed by both of you at the end of your meeting. Otherwise, arguing with the insurance company lead you nowhere.

Knowing that you had been mis-sold is a different story. I suggest you keep a copy of the proposal discussed and the documents which you have signed. You should also demand a specimen policy before making any decision. With the specimen policy at hand, list down insurance terms which are not clear to you. Discuss this with your agent and finally, confirm his/her answers with the Actuarial Department (with regards to figures, returns, dividends, etc) and Underwriting Department with regards to the clauses, limitations, benefits, etc. If they have two different answers, then the agent must be pulling your leg, cause at the end of the day, policy wordings will prevail.

Answer 4

When I took out an endowment in 1987, with what was then the Midland Bank, I was told that it would make something like £24k. As the endowment was only for £16k I thought why not, it seems like a good way of long term saving as well. After a gap of about 12 years they, by then HSBC, wrote to me and told me that there might be a shortfall of up to £4k. I was gobsmacked. How could an £8k profit turn into a shortfall? I complained of course and they turned me down. I appealed to the ombudsman, as your previous replier suggested, and they in effect told HSBC to offer me £2k compensation. I've since banked this and am basically hoping for the best.
I certainly don't recall ever receiving a letter telling me that there may be a shortfall at the end of the term.

Answer 5

1.) Take it as given you've been done.
2.) Endowment policies are a licence to print money.
3.) It costs less to walk away than provce you are wrong.
4.) Insurance companies have more time to waste than you

Answer 6

you dont have to proove it, THEY have to proove that they didnt mis-sell it. they have to provide documented evidence with your signature on to say that you knew the risks..go to whoever sold you the policy and tell them you think you were mis-sold. you will fill in a form there and then ,you dont need one of these "recovery/compensation" companys..it is straight forware to do yourself...a word of caution though, dont expect a vast sum back..we had a shortfall of £9000ish and only got &only got £710 back