Bonds Decision Reference 2024-0143

• Case Outcome: Partially upheld
• Year: 2024
• Date: 25 June 2024
• Reference: 2024-0143
• Finantial Sector: Investment
• Conducts Complained Of: Value of policy at surrender less than expected or projected

Decision Ref:

2024-0143

Sector:

Investment

Product / Service:

Bonds

Conduct(s) complained of:

Value of policy at surrender less than expected or

projected

Outcome:

Partially Upheld

LEGALLY BINDING DECISION OF THE FINANCIAL SERVICES AND PENSIONS OMBUDSMAN

The complaint relates to life policies taken out with the Provider in 1998 and 1999, the

trustees of which will herein be referred to as ‘the Complainants’.

The complaint was referred to this Office’s Legal Services Division for a formal

jurisdictional assessment, and a Preliminary Opinion was issued on 11 December 2020,

which set out the complaint that could be progressed to formal investigation and

adjudication. The Complainants accepted the Preliminary Opinion on 18 December 2020.

The Complainants’ Case

The Complainants say that in “1998 [they] took out 2 Bonds with [the Provider].” The

Complainants submit that one bond required monthly payments “to realise £645K on

death of [either party].” The Complainants say that the second bond was acquired by

“lump sum payment of £25K to pay our grandchildren £143K on our death.”

The Complainants say that in 2008, “at the 10th anniversary [of their bonds], after

accepting that the level of life cover was not guaranteed, as was expected, it was

acknowledged that the returns had not met the ambitious assumptions made at the outset,

to maintain the initial level of cover” and “at the 15th anniversary the cover was again

reduced”. The Complainants say that the assumed returns were strongly questioned, as to

whether they were reasonable in the light of fund performance in the short period prior to