© 2007 Policyholder Advocate

Made by Evan

I write regarding the coverage of the struggle between the Policyholder Advocate and those who appointed her as recommended by the Financial Services Authority.  I have been in the financial services industry almost 23 years and can vouch for the fact that the company is only disclosing part of the information to the press and this is likely to confuse and mislead policyholders who may accept far less than they are morally, and legally, entitled to. From a regulatory perspective this is hardly 'Treating Customers Fairly'. I would suggest that the company should correct all misleading information which has been made public and clear up the mess which is of their own making. The bullying of Clare Spottiswoode could be construed as poor corporate governance and will impact upon the reputation of what was once a variety of reputable companies who were merged into the megalith we see today. Is it any wonder that the life offices and with profits in particular are now completely discredited? Further confusion is being created by a recently invented word for all this, reattribution, it appears to be a new word for a legal form of mugging. Yet more confusion was created by Hector Sants when he told the Treasury Select Committee that it was reasonable to use the money for new business expenses, I would argue that the regulator is also being hoodwinked because the new business pays for itself by way of reduced surrender values and ongoing charges so if the company also takes money out of the fund for new business acquisition it is in effect imposing two levels of charges, contrary to what the company may think this isn’t a slush fund for intercontinental buying sprees. Furthermore it is completely unacceptable for compensation to be paid from the with-profit fund simply because the policyholders didn’t do any mis-selling and to add insult to injury they have already paid for the new business which was deemed to be wrongly sold. In any event there would be no need for any compensation if they had paid out what was actually due or had not used fictitious charges to set premiums between April 1987 and January 1995. Then there is the Needler case, which they could have won on appeal had the Board not decided against sound legal advice, this cost the policyholders many £millions.

Come on now, let’s get this over with and ensure that the owners of those policies which have matured or surrendered are included in the distribution of what was rightly theirs in the first place. From my point of view it would be good if the company could make amends for their acts or omissions with regard to the compensation paid out by IFAs for the shortfalls created by the companies to whom they entrusted their hard won goodwill and their clients’ hard earned money.

Evan Owen