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Keying blunders cost Clerical 17m

Clerical Medical is facing a bill of over 17m after keying errors meant some of its unit-linked policies have been mispriced for the last four years.

The blunder has affected many Clerical unit-linked pensions, life and bonds policies but the company says that there has been no impact on Oeics or with-profits policies.

In total, 144,000 customers have been affected by the errors, with 81,000 policies gaining and 59,000 policies losing out. The average gain was 144 and the average loss 95, although some lost over 500.

Clerical has promised to repay the money lost by policyholders while those that gained from the error will be able to keep the money.

It says it has kept the FSA informed about the matter, which was identified after routine checks. It says it has now implemented stricter controls to ensure a similar problem does not arise.

A spokesman at parent company HBOS says: “We are sorry for the error. We have put it right. No customer loses out. Those who have benefited from our error keep the gain. Those that have lost out will have that loss made good.”

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