Correspondence: 09/07/2003 - Getting an explanation for surrender and maturity values: a minor victory over The Equitable and a demonstration of the lack of helpfulness of the FSA, Alex Henney, EMAG 9 July '03 - Getting an explanation for surrender and maturity values: a minor victory over The Equitable and a demonstration of the lack of helpfulness of the FSA, Alex Henney, EMAG Background Last November I decided to ask The Equitable for surrender and maturity values for the with-profitss policies held by my wife and myself. When I was provided with the numbers, I then asked for an explanation of how they were derived from the values that had been provided (for all policyholders). I was told:- "We do not provide details of how we arrive at surrender values. It is not a serviced we offer". I regarded this as outrageous; it is analogous to a bank providing an opening balance and a closing balance, with no transactions (and charges) in between. On 18 November I wrote to Mr. John Tiner, Managing Director of the FSA, asking "would you please instruct the Society to provide myself and other members with the basis of their policy values. I hope you will agree that it is long overdue that the FSA does something to try to resolve a modicum of trust between the Society and its battered members, rather than just publish fine words. Please would you help us to get adequate information from Equitable". (This request was an elaboration of a section of an earlier letter I had written to him of 12 November titled "A complaint regarding the lack of information provided by the Equitable to its members", see website, to which he replied in an entirely unhelpful manner on 10 January, (see website). His reply to this particular request was as follows:-
"In your letter of 18 November, you set out details of the policies that you and your wife have with Equitable Life. You will understand that it is not for me to provide an explanation of the figures. However, there may be some general points I can make. First, I am not sure what the relevance might be of the ratios you have highlighted. For example, the guaranteed value is not a proportion of the indicative policy value. The values are derived independently, one by the addition of guarantees and the other by the addition of non-guaranteed bonus.
You will note that Tiner did not respond to my letter - I was not asking him to explain a set of figures, which he was not in an informed position to comment upon. Rather I was requesting him to instruct the Society to provide me and other members with the requisite information. I went through the routine of complaining to The Equitable (which not surprisingly achieved nothing), which is the necessary precursor to complaining to the Financial Ombudsman Service (South Quay Plaza, 183 Marsh Wall, London E14 9SR, T: 020 7964 1000, www.financial-ombudsman.org.uk). The FOS came up trumps, and I received the attached letter from The Equitable. On 19 June I wrote to Tiner as follows:-
"I am glad to say that the Financial Ombudsman Service did not take such a casual attitude as you did to other people's money, and I obtained from The Equitable an explanation of the calculations, which I attach. I understand from the writer of the letter that although the computer undertakes the calculations, she had been advised that it would be expensive to programme it to print out the intermediate steps. She calculated the figures by hand, which took about 1½ hours.
I await his response with interest. ALEX HENNEY |