The Consumers' Association is calling on the FSA to ensure that company
shareholders foot the bill for the pension and mortgage endowment reviews.
CA senior policy adviser Mick McAteer is concerned that policyholders may
pick up the tab for the reviews in response to the PIA's regulatory update
89 and in anticipation of the outcome of the windfall shares test case. The
CA wants the FSA to recommend that providers compensate those affected by
the reviews from shareholders' money.
McAteer says if the windfall test case finds in favour of the professional
indemnity insurers, then any redress received by life offices should be
shared among policyholders. The case, involving a Norwich Union
policyholder,will be heard in July. The High Court will determine whether
people who were missold personal pensions will have their compensation
reduced if they get windfall payments from their provider demutualising.
FSA spokeswoman Jackie Blyth says: “It is the regulator's role to ensure
consumers rec-eive appropriate redress.”