Upheld: Account administration errors complaint against Prudential Pensions Limited
Financial Ombudsman decision DRN-3779980 of 2023-01-13T00:00:00+00:00. Account administration errors complaint against Prudential Pensions Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-3779980 |
|---|---|
| Decision date | 2023-01-13T00:00:00+00:00 |
| Firm | Prudential Pensions Limited |
| Product | Pension |
| Claim type | Account administration errors |
| Outcome | Upheld |
| Remedy | Prudential Pensions Limited directed to pay within 30 days: (1) £500 total for distress and inconvenience (or £300 if £200 already paid); (2) £2,096.01 additional payment to increase total to £45,413.60; (3) interest at 8% per annum simple from 15 January 2021 to 17 May 2021 on £43,317.59 (if not already paid); (4) interest at 8% per annum simple on £2,096.01 from 15 January 2021 to date of actual payment. |
Summary
Mrs G complained about a seven-month delay in receiving pension benefits from her late husband's policy. Prudential received notification of death in October 2020 and all required documents by December 2020, but did not pay until May 2021, citing security verification issues related to an address mismatch. The ombudsman found Prudential should have encashed the pension when the death certificate was received in December 2020, resulting in a higher fund value of £45,413.60 rather than the £43,000 paid. Mrs G was awarded the additional £2,096.01 plus interest at 8% per annum simple from 15 January 2021, and £500 compensation for distress and inconvenience, recognising her vulnerability as a grieving widow with financial difficulties.
The Ombudsman's reasoning
The ombudsman found that while Prudential made reasonable efforts to verify the address, it failed to move funds into the cash fund when the death certificate was received on 7 December 2020, as required by its own policy and terms and conditions. The earliest date payment could have been made was 15 January 2021. The ombudsman determined that Mrs G should receive the fund value as at 15 January 2021 (£45,413.60) plus interest, rather than the amount actually paid (£43,000). The £48,000 figure Mrs G was quoted was a projected retirement value from a 2019 statement, not an entitlement, so she was not entitled to that amount. The ombudsman recognised Mrs G's vulnerability following her husband's death, her financial difficulties, and the considerable effort required to contact Prudential over several months, warranting £500 compensation for distress and inconvenience.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Prudential Pensions Limited, all decisions | 8 | 38% |
| Account administration errors, all decisions | 25,844 | 25% |
| Pension, all decisions | 15,579 | 47% |
Source
Read the original decision on the Financial Ombudsman Service website