Mis sold endowment policies

[triplets]

Any financial wizz kids out there please? We have just rec`d an offer on our endowment, need to know if its worth trying to get more or is it fair? Here are the facts:
Abbey Life Endowment taken out in Feb 1990 for 20 years
Premium £197.36pm
Sum assured £57,771
Projected shortfall at June 2003=£25,290
Projected maturity [email protected]% growth=£30,780
At present our mortgage debt is £40,000
Capital borrowed from Lambeth Building Society
Compensation offered today £7,912.92
Based on the position we would have been in if we had taken out a repayment mortgage.
Advice urgently needed please!

I am also trying to work out whether it is worth cashing in an old endowment, so am interested in any replies you get. What is your offer to cash in the endowment now? Surely not just the £7,912.92 - you have paid over £33,000 in contributions.

triplets,

I rec'd compensation for mis-selling of an endowment recently. Apparently, there is a set formula laid down by the FSA (I think) which companies can use to calculate the compensaion.
Also, the company which compensated me, paid for me to get advice from an independent financial advisor who reviewed the offer and advised whether the compensation was fair (according to this formula). Have Abbey Life offered to do this?

Azure, compensation is different from surrender value...it has to do with them restoring the mortgage to where it would have been if you had taken out a repayment mortgage in the first place. For the first 14 years of a 20 year repayment mortgage most of what you paid would be interest - which probably would be in the region of £33K for "nothing". So that presumably means they would knock the 7912.92 off the 40,000 balance outstanding, leaving c 32,000 on a repayment basis - triplets, have you asked the Lambeth what effect this will have on your monthly payments to them? You will stop paying the £197 to the Abbey, won't you? So if your net monthly payments remain the same and the mortgage is paid off in Feb 2010 you're OK. (You just don't get any surplus but we're all used to that idea now!)

How do you go about claiming compensation? We bought an endowment through a very good friend who is an IFA. Big mistake.

FSA (Financial Services Authority) here have a factsheet, which can be downloaded.
Also, Which had an online campaign about it, which gave information about how to complain including sample letters etc.

I see re compensation. My endowment was taken out in 1987 and the financial advisor was my sister's then boyfriend. Would also like to know how to claim compensation (yes, I know I'm an accountant but I know very little about personal finance!)

website address for which campaign is www.endowmentaction.co.uk/
and for fsa, it is www.fsa.gov.uk
I seem to have lost the ability to do links.

Links for you, tabitha!

Which campaign
FSA

Thank you.

Hi,
Thank you all for your replies. Still not sure what to do, husband says that we must not surrender the policy especially as we have only 6 years to go. Will try to get more advice I think before we jump in.

we are in the same position, waiting to hear back from Albany life, have you found out how much your monthly payments would be if you switched to repayment now? if you only have 6 years to go, you need to act quite quickly. we have changed to repayment this month, but have to keep the enowment going until we have an answer re: mis selling from Albany.

Triplets, I woould have thought you could do two things (depending on how much money you have now) If you take the compensation, use it to pay off your mortgage the mortgage debt would then be approx. £32,000 and you could then decide to change your mortgage to a repayment one to pay off the remaining term. If you stop paying the endowment you could use this £197.36 pm to increase your mortgage payments which could pay off the capital in time.

Secondly I am unsure if you can do this, but could you stop paying the endowment (freeze it so to speak) and in 6 years take the 'projected maturity value'. This means you would still get a bonus at the end of it. Or do you need to continue to pay into the endowment untl it matures?? If so you are paying in another £14k over 6 years, which means the fund won't have grown at all.

Ahhh I'm glad it's not just me struggling with this! I really need people's advice here as I'm totally lost! Basically my husband has only recently found out that he was mis-sold endowment some years ago, and we want to claim it back. I don't know if any of you will be able to help me but I thought I might as well ask on the off chance! So I wondering (as stupid a question as this may sound) - how exactly are we supposed to go about making a claim? I've read lots of conflicting advice on the subject and it's really thrown both myself and my husband. Are we better making the claims ourselves or going through a company? I was reading an article about a business called EMCAS has anyone heard of them? Would they be the type of company we should go through? We're really at sea here so any advice anyone could offer us would be fantastic x