Standard Life has succeeded in a claim against 11 professional indemnity insurers after it was forced to inject £100m into its pension sterling fund.
It claimed the 11 firms, which provided professional indemnity insurance to the company, 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 firm’s response to the losses was motivated by a desire to “do the right thing”.
A judgment in the Commercial Court in London last week found in favour of Standard Life. The 11 insurers have been granted leave to appeal.
Money Marketing revealed the dramatic 5 per cent fall in the value of the pension sterling fund in January 2009. The fund had 97,000 investors.
Standard Life had claimed in its marketing material that the fund, which was often used in lifestyling, could be a temporary home for investors’ money “when the short-term outlook for equities, fixed-interest securities and property is uncertain”. It added it was wholly invested in cash.
But the fund actually held a mixture of assets, including cash deposits, treasury bills and asset-backed securities, most of which were mortgage-backed securities.
In January 2010, the FSA fined Standard Life £2.45m for serious systems and controls failings that resulted in the production of the misleading marketing material in relation to the fund.