The great endowment battle

From today, 1.3m Standard Life policyholders are being told they have just 12 months left in which to make a complaint, while later in the month Norwich Union and Lloyds TSB will inform endowment customers to hurry up and get their complaints in.

Policyholders have just three years to submit a complaint after the receipt of a red letter warning that their endowment policy has little chance of meeting their mortgage.

But for many submitting the complaint will be only the start of a long and arduous struggle to receive compensation.

The Financial Ombudsman Service expects to handle 70,000 consumer complaints this year from policyholders who feel their provider hasn't dealt with their complaint adequately. It expects a similar number next year, before a slight dip in 2007.

Many firms have struggled to cope with the flood of complaints, with not enough staff and poor systems and processes contributing to the problem. Halifax, whose parent HBOS announced a £4bn profit recently, only has 100 people dealing with endowment complaints, while Abbey has also been accused of a tardy approach to complaints.

Feb 18, 2005
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