Not upheld: service quality, lack of clear communication, pension valuation explanation complaint against Phoenix Life Limited
Financial Ombudsman decision DRN-6362884 of 2026-05-15T00:00:00+00:00. service quality, lack of clear communication, pension valuation explanation complaint against Phoenix Life Limited. Outcome: Not upheld.
Decision detail
| Reference | DRN-6362884 |
|---|---|
| Decision date | 2026-05-15T00:00:00+00:00 |
| Firm | Phoenix Life Limited |
| Product | pension |
| Claim type | service quality, lack of clear communication, pension valuation explanation |
| Outcome | Not upheld |
| Remedy | Phoenix Life's offer of £250 compensation for trouble and upset, plus an offer to undertake a loss assessment to determine whether Mr L suffered financial loss as a result of the unclear communication regarding the medical questionnaire. |
Summary
Mr L complained to Phoenix Life about the significant drop in his Retirement Annuity Contract values between February and June 2025 (from £68,125.67 to approximately £56,675), the lack of explanation for this decline, and confusion about why he was asked to complete a medical questionnaire. Phoenix Life explained that RACs guarantee annuity income rather than fund values, and that transfer values fluctuate with market interest rates and gilt yields. The firm acknowledged that it failed to clearly communicate that the medical questionnaire was for assessing enhanced annuity eligibility through Standard Life, and offered £250 compensation plus a loss assessment. The ombudsman found this offer appropriate and did not uphold the complaint.
The Ombudsman's reasoning
The ombudsman found that RACs guarantee annuity income rather than fund values, and the transfer value fluctuates with market forces such as interest rates and gilt yields. While the lack of clarity regarding the medical questionnaire's purpose was a failing, Phoenix Life's offer to conduct a loss assessment was appropriate. The £250 compensation fell within the FOS guidance range of £100-£300 for repeated small errors or larger single mistakes causing distress and inconvenience lasting days or weeks.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Phoenix Life Limited, all decisions | 1,109 | 20% |
Source
Read the original decision on the Financial Ombudsman Service website