Legal and General Assurance Society Limited · DRN-6253742

The complaint Miss M complains that Legal and General Assurance Society Limited (L&G) refuse to pay the proceeds of a policy she believes is due to an estate of which she’s an executrix. What happened As the facts of this matter are known to both parties I’ll briefly summarise what I consider to be the key points. In 1987 Miss M’s grandparents Mr and Mrs M took out a joint life first death mortgage endowment policy with L&G (the Policy) the benefit of which was assigned to their then mortgagee. In return for paying £22.59 each month for 25 years the Policy was due to pay £4,361 plus any bonuses on maturity in 2012 or a minimum guaranteed sum of £14,250. Mr M passed away in 2007. Miss M says that Mrs M contacted L&G in 2008 but L&G said they were “unable to find any policy information”. Mrs M sadly died in February 2026. Miss M is one of the executors and the sole beneficiary of Mrs M’s estate. She contacted L&G in her capacity of executrix to claim any funds payable from the Policy but L&G told her that £6,213.70 was paid out in respect of the Policy in June 2005. Miss M doesn’t believe that the Policy was paid out in 2005 as she has the original paperwork. She says L&G haven’t provided any proof that it was paid out. L&G maintain that the Policy was paid out. They say that the Policy had a surrender value two years after it was taken out and, although they can’t locate any paperwork, they’re satisfied £6,213.70 was paid out in 2005. Our Investigator didn’t uphold the complaint. He was of the view that it was reasonable to conclude there was a payout in 2005 which brought the Policy to an end. Miss M is dissatisfied with the Investigator’s view and asked for the matter to be referred to an Ombudsman. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. I want to re-assure Miss M that I’ve read every document I received and considered all her submissions. I won’t refer to every document or each individual point she made as that’s not the purpose of my decision. My role is to give my overall conclusion and the reasons for reaching that. Having considered all the information before me I’m unable to uphold Miss M’s complaint as I’ve reached the same conclusion as our Investigator and for broadly the same reasons. Before looking at the merits of the complaint there are two points I need to address. The first is whether I’m able to deal with the complaint given that Miss M raised it more than six years after the event she complains about is said to have happened. Our Investigator addressed

-- 1 of 3 --

that saying he was content it could be considered under our rules and L&G agreed with him. For the sake of completeness and for the same reasons our Investigator gave I agree that I’m able to deal with this complaint. The second point is whether I’m able to deal with the matter given I haven’t seen any Grant of Probate and don’t have the consent of the other executor. Our service expedited this matter as Miss M provided details of her financial difficulties which could be made worse by any delay in considering the complaint. Due to Miss M’s circumstances our Investigator made an exception to our general rule that we need the consent of all executors or a Grant of Probate before we consider a complaint. I’m satisfied that, in light of the financial difficulties Miss M described, it was the right decision to consider the matter without the consent of the other executor. Miss M is concerned because L&G hasn’t retained any paperwork in relation to the Policy. She says this means they can’t prove they paid the Policy out and the fact she has the original paperwork proves it hasn’t been paid out. I disagree with Miss M on that. It’s not unusual for financial institutions to pay out policies without insisting on the return of the documentation issued when the policy was taken out. So, the fact that Miss M has the original paperwork doesn’t mean the Policy is still ‘live’. Further, the fact L&G don’t have any paperwork in relation to the Policy is not unusual given the payout was said to have been in 2005. It wouldn’t be reasonable for us to expect firms to hold on to closed policy documentation for an indefinite period. We consider six years a reasonable period to expect businesses to hold on to documentation after a policy is paid out. Here the Policy was said to have been paid out over 20 years ago and it wouldn’t be reasonable for businesses to hold on to documentation for that long. So, I don’t find anything concerning in L&G having no paperwork in relation to the Policy but what it means is that I have to look at what evidence we do have to decide what’s likely to have happened. L&G produced a screenshot of their computerised system which shows a payment with a payment reference number which is the same as the Policy number paid to people with the same name as Mr and Mrs M on 24 June 2005. Miss M feels that the £6,213.70 doesn’t correlate with what would have been due under the Policy but I note from the Policy schedule Miss M produced that it could be surrendered when at least two years of premiums had been made. And, as Mr and Mrs M took the Policy out in 1987 they could therefore have surrendered it any time after 1989. Miss M’s concerned because in correspondence L&G said the bank account the Policy proceeds were paid into was held with Virgin Money which, she says, didn’t exist in 2005. Our Investigator pointed out that the screenshot from L&G showed the account number and sort code but didn’t say the funds were paid into a Virgin account. He said it was likely that L&G checked the sort code online to try to guide Miss M towards where she could find the payment and he noted the sort code in the screenshot is the one used by Virgin Money. He pointed out that the account appeared to him to be an old Clydesdale account. I’m aware that Clydesdale Bank joined Virgin Money in 2018 and it’s reasonable to infer that L&G’s system records any old Clydesdale accounts as being part of Virgin Money. I must decide whether, on the balance of probabilities, it’s more likely than not that the Policy was paid out and I’m satisfied the weight of the evidence supports that it was paid out to Mr and Mrs M in June 2005. I accept that L&G have no original paperwork but as I’ve said given the time that’s passed that’s reasonable and not unexpected. The screenshot from L&G is strong evidence particularly given the Policy had a surrender value after two years. There’s been no suggestion Mr and Mrs M had any other product with L&G which could account for the

-- 2 of 3 --

£6,213.70 paid in their name. Further, there’s no evidence of monthly payments being made by Mr and Mrs M after 2005 and until Mr M’s death in 2007. I note that Mr and Mrs M remortgaged their property very shortly before the Policy was paid out and that the Policy was reassigned to them. By way of background, in the late 1990s the regulator became concerned that the reduced investment returns over recent years meant that there was a potentially huge problem brewing with the repayment of interest only mortgages. So, from 2000 an industrywide review process started whereby the product providers sent regular letters (at least every two years until 2005 and annually thereafter) explaining the likelihood of the policy reaching the target value. These letters, which were known as RAG letters, encouraged customers who were receiving letters saying there was a significant or high risk that their policies would not reach their target value to review their mortgage arrangements. L&G with profits policies almost all predicted shortfalls in the 2000s. Given the timing it seems to me that Mr and Mrs M’s decision to remortgage was likely to be as a result of the RAG letters and being told multiple times that the policy was unlikely to repay their mortgage. It therefore makes sense for Mr and Mrs M to have reviewed their finances when remortgaging and it’s likely they would have considered the funds they could liquidate under the Policy as part of that review. There are two final matters I should address. First, Miss M is of the view L&G’s responses to her enquiries have been contradictory because they initially told her there was no record of the Policy while simultaneously saying the Policy was paid out. I don’t find these responses contradictory as they’re essentially saying the same thing, that there was no Policy which was due to pay out. Second, one of L&G’s responses to Miss M thanked her for her complaint in which she raised concerns about the release of the Policy “which currently appears to remain unclaimed”. Miss M believes this wording means L&G accept that the Policy remains unclaimed but I’m afraid I disagree with her on that. It’s clear to me from the remainder of the letter that L&G are simply acknowledging her complaint pending investigation. The wording is clumsy and lacks clarity but it doesn’t mean that L&G accept the funds were unclaimed. I’m aware L&G accept that some their communication with Miss M could have been clearer and offered her £300 to reflect that. Our service is unable to make awards to personal representatives so it’s a matter for Miss M whether or not she accepts L&G’s offer. I recognise Miss M feels strongly that L&G has lied and provided false information to her grandmother and her. She refers to consequential losses which she holds L&G responsible for. I appreciate the points she makes but I can’t uphold her complaint as I’m satisfied L&G didn’t do anything wrong. My final decision For the reasons I’ve given my final decision is that I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask the estates of M and M to accept or reject my decision before 23 April 2026. Victoria Smith Ombudsman

-- 3 of 3 --