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Categories:Pensions

Standard Life succeeds in £100m sterling fund claim

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Standard Life has succeeded in a claim against 11 professional indemnity insurers after the provider was forced to inject £100m into the Standard Life pension sterling fund during the credit crunch.

Standard Life says the 11 firms, which provided PI insurance to the provider, should have covered the costs of the £100m payment, which was made in February 2009 after the fund suffered losses.

Former chief executive Sandy Crombie said the company’s response to the losses was motivated by a desire to “do the right thing”.

A judgment handed down in the Commercial Court in London today found in favour of Standard Life. The 11 insurers have been granted leave to appeal.

Money Marketing first revealed a dramatic 5 per cent fall in the value of the fund, which had 97,000 investors, in January 2009.

In February 2009, Standard Life announced plans to compensate all investors who lost out as a result of the revaluation.

The FSA subsequently fined the provider £2.45m for serious systems and controls failings that resulted in the production of misleading marketing material in relation to the fund.

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Readers' comments (7)

  • Surely the FSA has allocated this loss to the IFA community regarding recompense? What is going on?

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  • hugh jeego | 1 Feb 2012 12:40 pm

    No Hugo, Standard Life compensated all clients by their cash injection and may now receive their money back from their PI Insurers. There was no liability placed on the IFA community by the FSA for this one!

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  • This underlines why it is good to consider larger brands as in protecting their brand they did the right thing by investors originally without going bust, and then followed through correctly to recover what they could on PI.
    Harry Hedge-Fund would have just driven his Bentley round the corner and started again.

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  • No they didn't compensate all of their investors. They weasled out of compensating me to the tune of about £2,000 because of some policy wording they clung onto. My response? I transferred out my six-figure PPP fund into a self-managed SIPP and have done much better than SLI could ever have done.

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  • Sandy Crombie said Standard Life were motivated by a 'desire to do the right thing' I seem to recall that Standard Life spent a great deal of time trying to avoid their responsibilities and only paid out after the FSA investigated and made them do so. Standard Life got it wrong but yet again no heads rolled, in fact their top investment man got a huge bonus, after he had previously stated that big bonuses were wrong. Talk about spin!

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  • they allegedly knew about it for some time and conveniently waited for Sandy Crombie to get his knighthood before dealing with it. That said they did deal with it eventually. Shows the power of advisers

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  • "Misleading marketing material" No.. never - not a large trusted financial organisation... but hold on... sounds familiiar!

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