We’ve identified some minor errors in the charges that have been applied to a number of our unit-linked life and pension funds. To address this we’ve carried out a comprehensive review of our processes to minimise the chances of a similar problem happening again. Additional quality assurance controls have been put in place and the errors have been resolved.
We've followed industry guidelines laid down by the Association of British Insurers (ABI) when working out and correcting the errors, and the Financial Services Authority (FSA) has been kept fully informed.
In June 2008 we began writing to all our customers who are due a refund of £10 or more. We’ve now completed the review of our administration systems and we’re starting another major phase of mailings. The mailing schedule is as follows:
Advisers & Intermediaries 24 November
Employers (for Group Schemes) 1 December
Trustees 4 December
Customers 12 December onwards
Advisers and Intermediaries will be sent a list of any clients with affected live policies. The final phase of this mailing will finish early in 2009. The average refund is under £35 per policy. Less than 3% of Scottish Widows’ four million customers are affected. Some customers will receive a unit adjustment to their policy, while some will be sent a cheque. Customers with Retirement Accounts will have their refund invested in their Control Account. We’re not writing to customers who were undercharged and we won’t be reclaiming any gains.
Advisers, intermediaries, employers, customers and trustees do not need to take any action.
Policies where the overcharge is small (under £10) won’t receive a refund. This is in line with ABI guidelines which recognise that, in circumstances like this, it’s not practical to make small refunds. Instead we intend to donate the money to charity. Scottish Widows won’t benefit from the errors. Following customer research, the charities chosen for this purpose are Save the Children, Shelter and Help the Aged. If any customer affected by this decision is unhappy with our approach we will, of course, reimburse them directly.
Help & Assistance
We’ve set up dedicated helplines for any queries:
0845 716 6720 Clients, Advisers & Intermediaries
0845 716 6759 Employers, Trustees & Members
The helplines will be open from 8am-6pm Monday to Friday, and 9am-12.30pm Saturday.
0131 655 7693 Fax number
Media enquiries should be directed to the Scottish Widows Press Office on 0131 655 6818
Any written correspondence should be addressed to:
Scottish Widows plc
PO Box 28097
15 Dalkeith Road,
Edinburgh EH16 5GW
