In 2007 I complained to the Financial Ombudsman Service about being mis-sold an endowment.My complaint was rejected but the policy has now matured with a shortfall of almost 50%.
With these new facts, is there any means of recourse open to me?
D. H.
Chris Holloway, chartered financial planner with Dennehy Weller & Co in Chislehurst, Kent replies: As the Financial Ombudsman Service has rejected your claim for mis-selling there is no further action you can take except to seek advice on pursuing the matter through the courts.
The target maturity value of your policy assumed that a certain rate of investment growth would be achieved throughout the term of the plan.
But investment returns were never guaranteed. This 'investment risk' should have been made clear to you when the plan was bought. I would expect that this key point has already been checked by the FOS.
Source
Monday, March 15, 2010
Monday, February 15, 2010
Selling endowment policies may be more ideal than switching debt
The number of Britons who are transferring credit card debt to a card which offers an introductory offer of zero per cent interest has risen, a new report has revealed.
Findings from Santander Cards showed that in the first three months of 2010, £2 billion will be moved to new credit cards in an attempt to stop interest climbing on their balances.
Chris Radford, chief executive officer of aap - the UK's biggest buyer of endowment policies - said some of its customers had decided to sell their underachieving endowments in order to clear their credit card debt, rather than simply switching between products.
Switching to new deals to try and tackle debtIt was recently reported by aap that some lenders are clearing their customer's smallest credit card debts first, leaving the biggest amounts to accrue interest.
As such, Britons who are struggling to stay on top of a number of credit card repayments could find a larger proportion of their income is spent on meeting these financial commitments.
Switching to a zero per cent interest card could be seen as an ideal short-term technique for keeping interest down. However, these only last for a short while and consumers will eventually have to start paying higher interest levels again.
The Santander Cards study found that five per cent of people over the age off 55 intend to switch their credit card debt to a different product, with the majority of individuals deploying this technique below this age.
More than 4.5 million Britons will use this technique in the first three months of this year.
Emma Roberts, director at Santander Cards, said: "The number of people transferring balances has risen year on year, whilst the amount being transferred has fallen dramatically; this is a clear sign that consumers are becoming savvier when it comes to managing their finances."
Findings from Santander Cards showed that in the first three months of 2010, £2 billion will be moved to new credit cards in an attempt to stop interest climbing on their balances.
Chris Radford, chief executive officer of aap - the UK's biggest buyer of endowment policies - said some of its customers had decided to sell their underachieving endowments in order to clear their credit card debt, rather than simply switching between products.
Switching to new deals to try and tackle debtIt was recently reported by aap that some lenders are clearing their customer's smallest credit card debts first, leaving the biggest amounts to accrue interest.
As such, Britons who are struggling to stay on top of a number of credit card repayments could find a larger proportion of their income is spent on meeting these financial commitments.
Switching to a zero per cent interest card could be seen as an ideal short-term technique for keeping interest down. However, these only last for a short while and consumers will eventually have to start paying higher interest levels again.
The Santander Cards study found that five per cent of people over the age off 55 intend to switch their credit card debt to a different product, with the majority of individuals deploying this technique below this age.
More than 4.5 million Britons will use this technique in the first three months of this year.
Emma Roberts, director at Santander Cards, said: "The number of people transferring balances has risen year on year, whilst the amount being transferred has fallen dramatically; this is a clear sign that consumers are becoming savvier when it comes to managing their finances."
Selling endowments could avoid damage to credit references
Britons have been advised to check their credit references for any mistakes that could hinder their ability to secure personal loans and credit cards in the future.
The ICO said marks against a person's name could mean that when the time comes for them to need to secure credit, they are unable to do so.
Chris Radford, chief executive of aap - the UK's biggest buyer of endowment policies - said some of its customers had decided to sell their underperforming endowment policies to cover the cost of a large expenditure, rather than apply for a personal loan or credit card.
Credit references could be damaged by relying on credit
The ICO said making sure a credit file is correct is important because during the economic downturn, "millions" of Britons will turn to credit cards and personal loans to keep them afloat.
Requests for credit could be turned down by lenders if they believe a customer poses a high risk and is more likely to default on repayments.
However, rather than relying on credit to cover the cost of expenses, it could be wise for Britons to raise the money another way to stop household coffers falling into the red.
"Many of us will be relying on credit to get us through 2010. Out of date or wrong information in your credit file might not only stop you getting the credit you need but could have further damaging or embarrassing consequences," explained David Smith, deputy commissioner at the ICO.
Applying for more credit could prove damaging, however, if households already have to make a number of personal loan and credit card repayments.
Endowment policy cash could be an alternative to credit
Mr Radford, from aap, said rather than rely on credit, some of its customers had decided to sell their unwanted endowment policies to raise money required.
He added that should aap make an offer to purchase an endowment policy, it will always pay more than the surrender value offered by the insurance company.
Reasons to sell your endowment policy
Source
The ICO said marks against a person's name could mean that when the time comes for them to need to secure credit, they are unable to do so.
Chris Radford, chief executive of aap - the UK's biggest buyer of endowment policies - said some of its customers had decided to sell their underperforming endowment policies to cover the cost of a large expenditure, rather than apply for a personal loan or credit card.
Credit references could be damaged by relying on credit
The ICO said making sure a credit file is correct is important because during the economic downturn, "millions" of Britons will turn to credit cards and personal loans to keep them afloat.
Requests for credit could be turned down by lenders if they believe a customer poses a high risk and is more likely to default on repayments.
However, rather than relying on credit to cover the cost of expenses, it could be wise for Britons to raise the money another way to stop household coffers falling into the red.
"Many of us will be relying on credit to get us through 2010. Out of date or wrong information in your credit file might not only stop you getting the credit you need but could have further damaging or embarrassing consequences," explained David Smith, deputy commissioner at the ICO.
Applying for more credit could prove damaging, however, if households already have to make a number of personal loan and credit card repayments.
Endowment policy cash could be an alternative to credit
Mr Radford, from aap, said rather than rely on credit, some of its customers had decided to sell their unwanted endowment policies to raise money required.
He added that should aap make an offer to purchase an endowment policy, it will always pay more than the surrender value offered by the insurance company.
Reasons to sell your endowment policy
Source
Thursday, January 21, 2010
Almost 90% of Aviva endowments off-target
Almost 90% of mortgage endowments managed by Aviva are expected to miss their target maturity payout after another disappointing year for withprofits investors.Despite soaring markets and one of the best years for gilts, the insurer failed to achieve better returns for its 2.1m savers.
Payouts on endowments and many pensions have been reduced compared with policies that matured a year ago. And the insurer has trimmed annual bonuses on some endowments, reducing future growth prospects.
Aviva's two main with-profits funds grew by just 6% in 2009 compared with 22% for the FTSE 100.
A 25-year £50 a month mortgage endowment maturing today from the main CGNU fund pays £36,979, 6% down on the £39,299 from an equivalent plan last year. Both figures exclude the effect of one-off special bonuses.
A staggering 88% of Aviva plans are classed 'red' - unlikely to pay off a mortgage.
Standard Life, Friends Provident and Zurich are expected to unveil their bonus payouts later this month.
Source
Payouts on endowments and many pensions have been reduced compared with policies that matured a year ago. And the insurer has trimmed annual bonuses on some endowments, reducing future growth prospects.
Aviva's two main with-profits funds grew by just 6% in 2009 compared with 22% for the FTSE 100.
A 25-year £50 a month mortgage endowment maturing today from the main CGNU fund pays £36,979, 6% down on the £39,299 from an equivalent plan last year. Both figures exclude the effect of one-off special bonuses.
A staggering 88% of Aviva plans are classed 'red' - unlikely to pay off a mortgage.
Standard Life, Friends Provident and Zurich are expected to unveil their bonus payouts later this month.
Source
Tuesday, December 15, 2009
Selling your endowment policy could 'help to get your finances back on track'
Britons who are concerned about their finances should get on top of them as soon as possible, rather than waiting until it is too late, it has been advised.
Identifying where expenditure can be reined in during the current economic downturn could be a wise step for individuals to take. This could include stopping spending on credit cards, paying off high-interest personal loans or leaving store cards alone when tempted by the initial savings.
A spokesperson for aap - the UK's biggest buyer of endowment policies - said some of its customers had sold their underachieving endowment policies to organise their family debt management commitments.
Moneywise noted that budgeting on a monthly basis could be ideal for many Britons who get paid once every four weeks. As well as regular financial commitments - such as monthly debt repayments - people should take into account unexpected expenditure which could leave a dent in their finances.
"This exercise will, for many of us, turn the spotlight on one major problem - a shortage of cash," the resource stated.
"Next, consider ways of reducing your expenditure on essentials and non-essentials. Take a look at some simple steps that could help boost your cash levels without forcing you to cut back on anything," Moneywise added.
Britons who are struggling with their debt and do not want to fall back on essential financial commitments such as bills and rent may have started to address how they can obtain extra cash.
Rather than falling into further debt, people may want to clear the money they owe with a lump sum of cash, allowing them to stay afloat during the credit crunch.
Individuals who have already considered selling their unwanted endowment policies may not realise that selling a policy on the secondary market is another option available to them.
A spokesperson from aap - a company which specialises in buying endowment policies - added that if the firm decides to make an offer to buy an endowment, it will always pay more than the surrender value offered by the insurance company.
Source
Identifying where expenditure can be reined in during the current economic downturn could be a wise step for individuals to take. This could include stopping spending on credit cards, paying off high-interest personal loans or leaving store cards alone when tempted by the initial savings.
A spokesperson for aap - the UK's biggest buyer of endowment policies - said some of its customers had sold their underachieving endowment policies to organise their family debt management commitments.
Moneywise noted that budgeting on a monthly basis could be ideal for many Britons who get paid once every four weeks. As well as regular financial commitments - such as monthly debt repayments - people should take into account unexpected expenditure which could leave a dent in their finances.
"This exercise will, for many of us, turn the spotlight on one major problem - a shortage of cash," the resource stated.
"Next, consider ways of reducing your expenditure on essentials and non-essentials. Take a look at some simple steps that could help boost your cash levels without forcing you to cut back on anything," Moneywise added.
Britons who are struggling with their debt and do not want to fall back on essential financial commitments such as bills and rent may have started to address how they can obtain extra cash.
Rather than falling into further debt, people may want to clear the money they owe with a lump sum of cash, allowing them to stay afloat during the credit crunch.
Individuals who have already considered selling their unwanted endowment policies may not realise that selling a policy on the secondary market is another option available to them.
A spokesperson from aap - a company which specialises in buying endowment policies - added that if the firm decides to make an offer to buy an endowment, it will always pay more than the surrender value offered by the insurance company.
Source
Saturday, November 28, 2009
Selling your endowment policy 'could provide a financial cushion'
Britons have an estimated 38 million unused credit cards lying around with a combined credit limit of £200 billion, new research has revealed.
Almost one in ten consumers admit they have as many as four credit cards which they no longer use, while seven per cent have five or six stored away, the survey by uSwitch.com found.
Louise Bond, personal finance expert at the website, said with unemployment and the current credit crunch, it is no wonder why some people feel they should hang on to their credit cards, in case they need a financial cushion.
There could be other ways to make a household more monetarily stable. Britons who have already considered raising money through surrendering their unwanted endowment policies may not realise that they could get more than their insurance company could give them by selling their policies on the secondary market to firms such as aap.
When broken down, credit card hoarders have an average £11,969 to dip into should they find their household income is reduced, or an unexpected large expenditure is required.
"Hoarding as many as six unused credit card accounts is excessive. It is a problem for both the credit card industry and individuals," Ms Bond said.
"In recent years, we have seen providers close down these accounts or, in some cases, introduce a fee for consumers that don't use their credit cards."
Many Britons may be holding on to credit cards as a financial safety net should an unexpected event occur, such as redundancy.
With recent figures from the Office for National Statistics showing that UK unemployment continues to rise, having a spare credit card may give some consumers peace of mind.
However, consumers should be cautious of returning to credit in order to give them the financial security they are looking for in case household income drops in the future and they cannot pay off the balances.
For those Britons who have already considered disposing of their unwanted endowment policies - and may have decided to surrender them - there could be another way.
A spokesperson for aap - the UK's biggest buyer of endowments - said that selling a policy on the secondary market could give people a financial cushion they are looking for. Some of aap's customers have already sold their underachieving endowments to meet debt management commitments.
He added that if aap decides to make an offer on an endowment, it will always pay more than the surrender value.
Source
Almost one in ten consumers admit they have as many as four credit cards which they no longer use, while seven per cent have five or six stored away, the survey by uSwitch.com found.
Louise Bond, personal finance expert at the website, said with unemployment and the current credit crunch, it is no wonder why some people feel they should hang on to their credit cards, in case they need a financial cushion.
There could be other ways to make a household more monetarily stable. Britons who have already considered raising money through surrendering their unwanted endowment policies may not realise that they could get more than their insurance company could give them by selling their policies on the secondary market to firms such as aap.
When broken down, credit card hoarders have an average £11,969 to dip into should they find their household income is reduced, or an unexpected large expenditure is required.
"Hoarding as many as six unused credit card accounts is excessive. It is a problem for both the credit card industry and individuals," Ms Bond said.
"In recent years, we have seen providers close down these accounts or, in some cases, introduce a fee for consumers that don't use their credit cards."
Many Britons may be holding on to credit cards as a financial safety net should an unexpected event occur, such as redundancy.
With recent figures from the Office for National Statistics showing that UK unemployment continues to rise, having a spare credit card may give some consumers peace of mind.
However, consumers should be cautious of returning to credit in order to give them the financial security they are looking for in case household income drops in the future and they cannot pay off the balances.
For those Britons who have already considered disposing of their unwanted endowment policies - and may have decided to surrender them - there could be another way.
A spokesperson for aap - the UK's biggest buyer of endowments - said that selling a policy on the secondary market could give people a financial cushion they are looking for. Some of aap's customers have already sold their underachieving endowments to meet debt management commitments.
He added that if aap decides to make an offer on an endowment, it will always pay more than the surrender value.
Source
Sunday, November 15, 2009
Selling your endowment policy 'could help meet debt management needs'
An increasing number of Britons are defaulting on their credit card repayments, numerous sources show, a problem which could be compounded by the current unstable job market.
The Organisation for Economic Co-operation and Development has raised concerns about the financial state of Britain, with many UK families struggling to meet their personal debt commitments.
Chris Radford, chief executive officer (CEO) for aap - the UK's biggest buyer of endowment policies - said that some of its customers had sold their unwanted endowment policies for their household debt management needs.
Finding the money to clear credit card debt could be a wise option. Speaking to the Daily Mail, Peter Sargent, a partner at insolvency specialists Begbies Traynor, said some families have no savings to fall back on when times get tough.
"More and more people are staring financial ruin in the face. The number defaulting on their credit-card debts is growing and therefore the number of personal insolvencies will grow over the next two years," he told the newspaper.
He said when individuals are in stable employment the prospect of clearing personal debt may not be as daunting, "but if they lose their job they've had it".
Some individuals may turn to the estimated 38 million unused credit cards lying around the home, which have a combined credit limit of £200 billion, to meet their financial commitments, uSwitch.com recently revealed.
This tactic may not be a wise move to make, as this could leave people further in debt. And many consumers could be rejected from obtaining credit in the future, because of their history of defaulting. A rejected application could leave a blemish on the credit history of individuals.
Rather than relying on more credit as a financial crutch, Britons may want to assess other ways in which to clear their climbing credit card debt.
Aap CEO Chris Radford said that some of the firm's customers had sold their unwanted endowment policies to keep on top of debt management commitments.
Individuals who have already considered surrendering their underperforming endowment policies may not realise that selling it to a secondary market maker such as aap could see them obtain more cash.
Source
The Organisation for Economic Co-operation and Development has raised concerns about the financial state of Britain, with many UK families struggling to meet their personal debt commitments.
Chris Radford, chief executive officer (CEO) for aap - the UK's biggest buyer of endowment policies - said that some of its customers had sold their unwanted endowment policies for their household debt management needs.
Finding the money to clear credit card debt could be a wise option. Speaking to the Daily Mail, Peter Sargent, a partner at insolvency specialists Begbies Traynor, said some families have no savings to fall back on when times get tough.
"More and more people are staring financial ruin in the face. The number defaulting on their credit-card debts is growing and therefore the number of personal insolvencies will grow over the next two years," he told the newspaper.
He said when individuals are in stable employment the prospect of clearing personal debt may not be as daunting, "but if they lose their job they've had it".
Some individuals may turn to the estimated 38 million unused credit cards lying around the home, which have a combined credit limit of £200 billion, to meet their financial commitments, uSwitch.com recently revealed.
This tactic may not be a wise move to make, as this could leave people further in debt. And many consumers could be rejected from obtaining credit in the future, because of their history of defaulting. A rejected application could leave a blemish on the credit history of individuals.
Rather than relying on more credit as a financial crutch, Britons may want to assess other ways in which to clear their climbing credit card debt.
Aap CEO Chris Radford said that some of the firm's customers had sold their unwanted endowment policies to keep on top of debt management commitments.
Individuals who have already considered surrendering their underperforming endowment policies may not realise that selling it to a secondary market maker such as aap could see them obtain more cash.
Source
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