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Re: Why do financial consultants have a bad repuation.

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> > Thom Baguley wrote: > > [snip] > > >selling life insurance to someone with no dependents > > > is not considered mis-selling by the FSA > > [snip] > > Well, it isn't on their list of reasons to claim

Which list ?

If you mean one concerned with endowment mortgages, then it may be because mortgage lenders often require borrowers to insure their lives.

More fundamentally, the FSA has no exhaustive list of ways to give bad advice.

I promise you that the correct legal approach would require good reasons to regard the sale of life insurance to a person with no dependents as good advice, and the FSA is bound by the law. The FOS IME would, corporately, look askance at such sales as well, but there are 250 case officers, and dozens of them are useless.

and I've heard it repeated by > several other people. I think the defense is that there is a benefit to be > derived from it - presumably all those people in their twenties able to sleep > at night now that their aged parents won't be lumbered with paying off their >mortgage.

That might not be bad reason - don't underestimate the distress such situations can cause.

However, unless the punter said so to the adviser, then it wouldn't work for me as justifying an otherwise bad sale.

> In my wife's case there was AFAIK no benefit at all (as her pension > death-in-servive benefits would have cleared the mortgage quite

comfortably).

Are you saying that the FOS overlooked this ?

Reply to
Rhoy the Bhoy
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Standard Life Norwich Union Sun Life Clerical Medical Eagle Star Prudential

Reply to
john boyle

Not even if they're guarantors?

Reply to
Ronald Raygun

In article , john boyle writes

Well if Eagle Star managed it surely just about everyone must have done.

Reply to
Timothy Lee

In article , john boyle writes

The pension scheme could be changed, she could change jobs, the company could fold etc.

Reply to
Timothy Lee

I think it's partly that failing to sell insurance to someone who does need it could be extremely bad and could easily lead to legal action for bad advice, so advisors are likely to err on the side of caution. For example, if someone is single but gets married a few months later and has children a year after that, they might well be able to sue on the grounds that the advisor should have forseen that that was likely, even if they told the advisor that they had no plans to marry at the time.

Reply to
sburke

[snip]

Well, obviously, as I said before, like, all credit to repetition, but at the end of the dah, no matter how often you say it, I do not believe it to be so.

Reply to
Rhoy the Bhoy

In message , Thom Baguley writes

What regulator? Term assurance isnt a regulated product.

Reply to
john boyle

Does that mean the FSA can't deal with it as part of a linked product like an endowment?

Thom

Reply to
Thom Baguley

If you're talking about a term assurance policy, at the moment (until regulation changes next year), it depends on who sold it, if it was sold by a non regulated adviser then by definition "non regulated" it is outside the scope of the regulators, if however it was sold by an appointed rep for instance who is regulated, the product then becomes regulated and yes it can be looked at.

If however you mean the integral life cover of an endowment, it is not separate from the endowment, so the whole policy itself is either suitable or not, and it's not as simple as saying that somebody is single so no life cover is needed so can't have endowment, they may want to leave an unencombered property to their relatives/partners or friends on death, they may want to ensure that when the do get married/become parents it's already in place etc.

Arfie

Reply to
Arfie

Maybe true, but still pretty feeble as a sales pitch and in practice c**p (as AFAICT few endowment salespeople ever ask the relevant questions to determine the suitability in these cases) . In my experience a good proportion of people sold endowments don't understand that some of their monthly payment is going on life insurance. I've yet to meet someone who can tell me what proportion goes on the insurance element and therefore could check whether the insurance element is good value.

Thom

Reply to
Thom Baguley

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