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Negligent PLC Over Endowment Policies

Elizabeth Norris successfully acted for her client in a claim against a large financial plc for shortfalls on three endowment policies that the client had purchased whilst in their employ.

The client had formerly worked for the large financial PLC and had taken advantage of a staff incentive scheme during his employment which entitled him to interest only mortgages at beneficial rates. Part of this scheme meant that he also took out three endowment policies as vehicles for repayment of the mortgages. He was not however advised of any risk whatsoever that the endowment policies may not be sufficient to repay the mortgages on maturity. The documentation he received regarding the endowment policies did not sufficiently detail the risks present with the types of policies. The client later received a number of red warning letters that warned of a high risk of a shortfall on all three policies.

Proceedings were issued on behalf of the client as it had not proved possible to conclude a settlement. Shortly before trial the defendant agreed to make good any shortfalls suffered by our client and fully recompensed him for his legal costs incurred. The client was delighted with the result and has meant that he has no concerns about finding additional money on maturity of his mortgages in the years to come.

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