Exposure of Endowment Justice's tactics to encourage consumer complaints has, unsurprisingly, raised IFA comments about their methods of approach and further questions about the use of reprojection letters.
One IFA in particular, has presented a constructive argument concerning endowment projections, which asks whether clients should be made aware of terminal bonuses, given the impact they can have on the overall investment.
If you have any comments to add, email the editor and we’ll post them as soon as possible.
Diane Whicher, IFA, asks:
“When is someone accurately going to put the client first? I have come across several clients wanting to encash their endowments - with or without compensation payments but not, thank goodness, sold by me - because of projections that do not take into account terminal bonuses (TBs).
“Some of these are within two years of maturity and would be so much worse off unless TBs fall dramatically before then.
“I have still not come across any 25 year policies that haven’t made their target with substantial surplus or heard or any - have any of you?
“We have been going 39 years, so do see a lot of maturities and speaking to other IFAs this seems to be the case with them also. I know these are the earlier policies with good bonuses in the earlier years but these too are ones being encashed early.
Barry Davys, IFA at Strathardle Assets, adds:
“Thank you for your article, and the editorial comment, on Endowment Justice. I have received a letter from this company on behalf of an ex client.
“Being objective as possible, which I accept is difficult on receiving such a letter, it struck me as being designed to brow beat the recipient into submission.
“The supporting paperwork also contained errors, including quoting two different insurance company names when the client only had one endowment.
“As you rightly point out, Endowment Justice also works on a 20% COMMISSION. Oh, that IFAs were paid 20% on their investment business!”
DB and a lack of alignment
Encouraging better use of tech
Win one of three £20 Amazon vouchers
Vanguard's multi-asset range