Not upheld: Investment mis-selling complaint against ReAssure UK Services Limited

Decision detail

Summary

Mr P complained about his National Mutual Life with-profits pension policy, now administered by ReAssure, regarding the absence of demutualisation benefits, application of final bonuses, GMP costing methodology, annuity guarantee application, and a reduction in the guaranteed cash sum. The ombudsman found that ReAssure's administration was appropriate and compliant with policy terms and regulatory requirements. The use of current annuity rates was justified as it provided greater value to Mr P under the 'share of the fund' approach. The ombudsman noted that bonus declarations are commercial decisions for the Board of Directors and that neither the regulator nor the independent With-Profits Committee had expressed concerns about ReAssure's management. The complaint was not upheld and no award was made.

The Ombudsman's reasoning

The ombudsman determined that ReAssure's administration of the with-profits fund and Mr P's policy was appropriate and in accordance with policy terms and regulatory requirements. The decision to use current annuity rates rather than policy rates was justified because the 'share of the fund' basis provided greater value to Mr P than alternative calculation methods. The ombudsman noted that bonus levels are commercial decisions for the Board of Directors following actuarial advice, which the ombudsman cannot investigate. The regulator, independent With-Profits Committee, and actuaries had expressed no concerns about ReAssure's management. The guaranteed cash sum reduction was explained as a recalculation of current cash value rather than an unfair reduction. Final bonuses are discretionary and not guaranteed separately; they serve to uplift guaranteed benefits to asset share value.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website