is this mis selling or what ?

[cardiac arrest]

I have just had it confirmed officially (after many years) that my pension policy I bought in 1987, and about to mature in March this year, has restrictions in it which were
not told to me.

Specifically I was quoted, back then, 'potential' retirement pension of over £15k..then other lesser ones at at £13k and £11k..
Every year I have had estimates based on 'performance' of a pension of over £10k
In 1995 I was thinking of t/f this pension and was told then returns of about £11k were 'potentially' available. So i kept it.

I realise, over the years,returns have fallen and fully accept (reluctantly) that investments have been poor generally.

BUT, a few lines in my policy said there was a maximum pension payable of £6k.

When I've queried this rather ambigous wording I was told it 'didn't apply to me'.

As pension day has got nearer I've been having quite bit of contact with the provider and this 'maximum pension' issue has come up again.
Last week I was told there was indeed a maximum the policy would ever pay out, despite all these years of them writing to me with 'potential'
returns of £10k, £13k,£15k etc...

So, back in 1987 when I decided to buy the policy, based on their quotation of potential returns my decision was based on a lie. And this lie has been
perpetuated over the whole term of the policy, until now. I don't know why they never came clean with me,and continued to quote higher returns than they
would ever pay out.

So where does this leave me, after almost 28 years ?? (the policy will only be paying £5k by the way)

[nightwatch]

Re: is this mis selling or what ?

I haven't got a clue, but I hope some one has, best of luck xxxx

[The Tech Clerk]

Re: is this mis selling or what ?

when you asked for a quote they would of supplied usually 3 projections i.e.:-

5% Forecast 7.5% forecast & 10% forecast, and that states forecast, as no one can predict the future rates up/down so are loose estimates, if a bottom rate guarantee % the better as lower bar would be in place to stop very low rate, we had them in Transfer 32 section, thank goodness as our policies from old employers had a built in percentage guarantee as interest was only added 1st few years especially Norwich Union (Aviva took over), but still short of what was expected, hence the mis-selling scandal on these policies, the sellers had to rectify the early years shortfall with another policy to the value estimated lost, BUT not cover potential later years.


See the adviser who took it out for you and see if anything can be done, which I doubt but worth a try, we all lost out on these not pounds but thousands of pounds.

We all lost out through excessive charges & Government raids on funds.

[cardiac arrest]

Re: is this mis selling or what ?

when you asked for a quote they would of supplied usually 3 projections i.e.:-

5% Forecast 7.5% forecast & 10% forecast, and that states forecast, as no one can predict the future rates up/down so are loose estimates, if a bottom rate guarantee % the better as lower bar would be in place to stop very low rate, we had them in Transfer 32 section, thank goodness as our policies from old employers had a built in percentage guarantee as interest was only added 1st few years especially Norwich Union (Aviva took over), but still short of what was expected, hence the mis-selling scandal on these policies, the sellers had to rectify the early years shortfall with another policy to the value estimated lost, BUT not cover potential later years.


See the adviser who took it out for you and see if anything can be done, which I doubt but worth a try, we all lost out on these not pounds but thousands of pounds.

We all lost out through excessive charges & Government raids on funds.

Yes, mine is exactly the same , the GMP was already in place with my old employers so all Norwich Union did was take over that guarantee. I got 3 quotes from different companies via my employers chosen 'agent' Mercers Limited...they all said the same kind of things...projections att 13%, 11% and 9%...the chance to take benefits earlier or a cash lump sum ! ha ha, those were the days eh ?..We all know what happened, floated themselves and creamed off 10% of the fund for the shareholders...then not enough to pay any bonuses..and what do you end up with, welljust exactly what you started with, the basic GMP you had anyway ...

Fact is, I left my excess pension in the company scheme and if I'd left the GMP too I would have been able to get a bigger tax free lump because the pension value would have been higher...and you can take 25%of it (for a reduced pension of course)...but , you lose some, and you lose some...

The naughty bit though was tucking away the 'maximum payable' bit in the policy wording (who reads or even understands these policies)..so all their quotes and promises were just pie in the sky...and of course they continued to quote these imaginery 'potential' returns for years and years afterwards,perpetuating the lie.

I've written to them anyway, so see what they say..am sure they'll have some way of saying it's all my own fault....or that it was an 'admin error'..and offer me £50 for the 'stress' of it all ...

I did speak to an IFA back then, but they closed down years ago and have disappeared from the radar, although I still wonder what Mercers' role was in all this...probably looking after the companies' interests I expect..

[Undercover Elsa]

Re: is this mis selling or what ?

Hi Cardiac Arrest, the Pensions Advisory Service might be a good place to start, if you haven't already. You can contact them on their helpline, by webchat or email:
http://www.pensionsadvisoryservice.org.uk/ask-us

Elsa x

[cardiac arrest]

Re: is this mis selling or what ?

Hi Cardiac Arrest, the Pensions Advisory Service might be a good place to start, if you haven't already. You can contact them on their helpline, by webchat or email:
http://www.pensionsadvisoryservice.org.uk/ask-us

Elsa x

Hi Elsa, yes thanks for that. I did indeed drop TPAS an email, well one of their online forms tbh but same thing. Normally takes them 2 or 3 weeks to allocate it to one of their staff and for them to get back to you though. I've emailed Aviva too, and theri complaints procedure says they'll respond in 10 days...so waiting for them too...I was wondering about Mercers though,but perhaps I'll just sit tight a while and wait and see what replies I get first.

I'm still unsure though where I'd end up with this. Aviva could argue the policy is only paying £5k anyway so what am I worrying about a £6k limit for ? But I suppose we need to go back to 1987 and ask a few 'what ifs' ...what if I had done something else with my money...left it in the company scheme, sold to somebody else or transferred to new employer ?..Non of these things went through my head at the time..and Mercer certainly didn't suggest any other alternative than a S32..and that was it...even the IFA said go for the S32....obviously neither of them looked at the policy wording either...

There's a lesson here for others I reckon..if you don't understand your pension investments....then find out and don't just leave it like I did...trust nobody...

[pompeyfaith]

Re: is this mis selling or what ?

I have a S32 Norwich now Aviva policy too, never did fully understand it and still don't now like many I trusted the IFA who sold it too me.

[Undercover Elsa]

Re: is this mis selling or what ?

I'd still give it a try, would you have bought it if you'd been told the max payout was £6K, did they put it in writing that the limit didn't apply to you? If that was the case why did they keep sending you projected earnings, upon which basis you decided to stay with the scheme?

Maybe a SAR is the way to go next.

Not quite the same, but I took my works ill health pension scheme on, and they argued black was white at first, but after I got a SAR I found loads of errors and eventually they paid up.

[cardiac arrest]

Re: is this mis selling or what ?

I'd still give it a try, would you have bought it if you'd been told the max payout was £6K, did they put it in writing that the limit didn't apply to you? If that was the case why did they keep sending you projected earnings, upon which basis you decided to stay with the scheme?

Maybe a SAR is the way to go next.

Not quite the same, but I took my works ill health pension scheme on, and they argued black was white at first, but after I got a SAR I found loads of errors and eventually they paid up.

Thanks Elsa, Do you know I never thought of a SAR...in fact I hadn't realised I could submit one on an investment policy, but now you mention it...I should have. It would be good to see the correspondence although Norwich Union never did write and say the maximum clause did not apply to me, because I never asked. Why would I ? The only time they did was a via a recent telephone call in December. What they did say, in writing, is look at these potential returns Mr ****...you could have a cash lump sum, or retire early etc..and I do have those letters from 1987 thru' to 1995..after that , when Aviva took over, it was more about 'look at your guarantees' and their shift from paying annual bonuses to a final bonus policy...Even now, and this is what Iam learning, the final bonus is only paid if your investment in the fund is valued at more than your guaranteed lump sum plus any bonuses added. So it's a notional payment because it doesn't increase the value at all,just makes them the same. Aviva have sent me annual statements recently with my fund value (based on the with profits fund valuation) and these have always been much less than the guaranteed fund I have accumulated over the years...so there's some catching up to do for it to get higher than my guarantee and then for a final bonus to be added. So I'm not really expecting a final bonus either.

Another aspect of it is the 'opportunity' to buy an annuity from elsewhere (they say)...but with annuity rates plummetting the same as investments have done, the final fund value will never be big enough to buy an annuity elsewhere that is going to pay the same , or more, than the GMP. I accept Aviva have to stand the loss on this..but that's no consolation tbh.
So it's a double whammy. Had I chosen to leave the money in my company scheme, the valuation (albeit on a different method)would have been double that which Aviva have acheived, and I would therefor have been able to take a tax free lump sum from my 'pot'.

In answer to your question, would I have bought the policy if Norwich Union had come clean about the maximum payment of £6k?, well most definately not ! There were two other companies that quoted similar (but slightly less) projected returns at that time..would I have chosen one of them, or would I have thought...leave it where it is or transfer it into my new employers pension scheme ? It may well have made me think about it, but Mercers didn't propose either of those options, and neither did the IFA I spoke to.

I'll see what Aviva come back with, and if I don't like it I will send a SAR...or maybe I'll send one anyway...and perhaps one to Mercers too.

Thank you for the suggestion !

[cardiac arrest]

Re: is this mis selling or what ?

I have a S32 Norwich now Aviva policy too, never did fully understand it and still don't now like many I trusted the IFA who sold it too me.

You and many thousands of others..I suppose the main questions would be - what scheme were you in at the start, was it a defined benefits scheme with your employer. If it was, how much did they value your years service at when you asked for a valuation for transfer purposes. Did it included both your GMP and any excess you had in your scheme. What would you have expected your employers scheme to pay out compared to what Aviva are now quoting.Were there other options, like transferring your pot into a new employers scheme ..and if so, how much would that have been worth. Were you given comparable figures for all three options...

The problem many have had with Aviva, is that because the fund has performed poorly, they will have used any excess pension you earned in your employers scheme to prop up the S32 policy, so you may wellhave lost all of your excess funds, and still only get the GMP...which incidentally your employer would have guaranteed anyway. Based on my experience, did they slip in a little 'maximum' pension clause after to agreed to transfer to Aviva...

Each case is different, and fortunately for me only transferred my GMP element, and left the excess I had accrued in my old employers scheme..which has grown ok and which will pay out, but many didn't, and as such have lost all of that money...not an inconsiderable amount.

i didn't know any of this, and like most other people just trusted things to be ok..now here I am weeks away from drawing any benefits and dashing around and trying to ask the questions at the last minute. My trust was misplaced, I would have done things differently...but I accept that this is all in hindsight...had the policy returns been as predicted from the outset I'd be have been much happier about it over the years of the policy life...but not if Aviva had then turned round and said, yes here you are Mr ***, your pension will be £15,000 pa, as we estimated all those years ago...but unfortunately we're only going to pay you £6k because we slipped in a little maximum payment clause which we never you told you about, but which you should have read..so yah boo !

[The Tech Clerk]

Re: is this mis selling or what ?

Thanks Elsa, Do you know I never thought of a SAR...in fact I hadn't realised I could submit one on an investment policy, but now you mention it...I should have. It would be good to see the correspondence although Norwich Union never did write and say the maximum clause did not apply to me, because I never asked. Why would I ? The only time they did was a via a recent telephone call in December. What they did say, in writing, is look at these potential returns Mr ****...you could have a cash lump sum, or retire early etc..and I do have those letters from 1987 thru' to 1995..after that , when Aviva took over, it was more about 'look at your guarantees' and their shift from paying annual bonuses to a final bonus policy...Even now, and this is what Iam learning, the final bonus is only paid if your investment in the fund is valued at more than your guaranteed lump sum plus any bonuses added. So it's a notional payment because it doesn't increase the value at all,just makes them the same. Aviva have sent me annual statements recently with my fund value (based on the with profits fund valuation) and these have always been much less than the guaranteed fund I have accumulated over the years...so there's some catching up to do for it to get higher than my guarantee and then for a final bonus to be added. So I'm not really expecting a final bonus either.

Another aspect of it is the 'opportunity' to buy an annuity from elsewhere (they say)...but with annuity rates plummetting the same as investments have done, the final fund value will never be big enough to buy an annuity elsewhere that is going to pay the same , or more, than the GMP. I accept Aviva have to stand the loss on this..but that's no consolation tbh.
So it's a double whammy. Had I chosen to leave the money in my company scheme, the valuation (albeit on a different method)would have been double that which Aviva have acheived, and I would therefor have been able to take a tax free lump sum from my 'pot'.

In answer to your question, would I have bought the policy if Norwich Union had come clean about the maximum payment of £6k?, well most definately not ! There were two other companies that quoted similar (but slightly less) projected returns at that time..would I have chosen one of them, or would I have thought...leave it where it is or transfer it into my new employers pension scheme ? It may well have made me think about it, but Mercers didn't propose either of those options, and neither did the IFA I spoke to.

I'll see what Aviva come back with, and if I don't like it I will send a SAR...or maybe I'll send one anyway...and perhaps one to Mercers too.

Thank you for the suggestion !

The 25% draw down was for all policies. I took 25% on my little ones as well tax free, no extras, 25% was set in stone no additional. been thru complaints years ago and got no where with any regulator. Ironically it was the Inland Revenue who contacted me weeks before retirment and informed me what the amount of Pension from Aviva should and no less, they were correct as Aviva later confirmed the pension I was starting to receive. (less Tax of course)

[Undercover Elsa]

Re: is this mis selling or what ?

At the time you took your pension out, a lot of private pensions were mis-sold. People were persuaded away from their occupational schemes without being given the proper information, such as (accurate) projections of how the occupational scheme would perform vs the private scheme.
A friend of ours who was on the dole was recruited to sell these pensions. I think he had a short training programme then on the road he went, advising people to buy these policies - on commission only. He tried to sell one to us but we declined.

Have a look here. Is this the Mercers you refer to?
http://www.telegraph.co.uk/finance/p...s-a-boost.html

[cardiac arrest]

Re: is this mis selling or what ?

The 25% draw down was for all policies. I took 25% on my little ones as well tax free, no extras, 25% was set in stone no additional. been thru complaints years ago and got no where with any regulator. Ironically it was the Inland Revenue who contacted me weeks before retirment and informed me what the amount of Pension from Aviva should and no less, they were correct as Aviva later confirmed the pension I was starting to receive. (less Tax of course)

Not always the case, if the policy has an element of GMP in it there can only be a tax free lump sum on the excess value of the investment. The GMP has to be met first and can not be less , so if the fund value is not enough to pay for an annuity to buy the GMP, there is no excess and thus no entitlement to a 25% tax free lump sum. This what a lot of people who bought section 32 policies have found ..even when they have thrown in their whole pension from a defined benefits employers scheme.. Policies which did not have an element of GMP would be able to pay a lump sum though.,as you have said.

[cardiac arrest]

Re: is this mis selling or what ?

At the time you took your pension out, a lot of private pensions were mis-sold. People were persuaded away from their occupational schemes without being given the proper information, such as (accurate) projections of how the occupational scheme would perform vs the private scheme.
A friend of ours who was on the dole was recruited to sell these pensions. I think he had a short training programme then on the road he went, advising people to buy these policies - on commission only. He tried to sell one to us but we declined.

Have a look here. Is this the Mercers you refer to?
http://www.telegraph.co.uk/finance/p...s-a-boost.html

yes that's them They used to be called William Mercer Fraser but are now Mercers Limited. They obtained the quotes back in 1987 as the employer had engaged them. I rang Mercers yesterday and they said they have now sold that part of their business, and that it was then sold again to another company....They identified my employer from 1987 on their computer though, and were going to pinpoint exactly who would answer my queries, with a name and contact number, they would ring me back in the afternoon. They didn't. I'll ring them again on Monday, as usual it is a battle with everybody, chasing up because they don't reply or respond is the norm it seems, or maybe I'm just impatient with them..Now if I owed them money, well we all know how prompt they can respond.

[Undercover Elsa]

Re: is this mis selling or what ?

Exactly. I would definitely SAR them, and specify that you want copies of recorded phone calls too.