‘I can’t claim £26k endowment payment because TSB is ignoring me’


TSB sign
Our readers took out their mortgage with TSB  years before it separated from Lloyds in 2013


Dear Katie,

My wife and I would be grateful if you could help with an incredibly frustrating situation. In 1995 we took out an interest-only mortgage with Lloyds TSB, and an endowment plan with Allied Dunbar, which is now Zurich. Our financial adviser at the time recommended the plan was set up in two sections: half under my name and half under my wife’s name.

My wife suffered a critical illness and in 2003 her half paid out, leaving the plan in my name only. We paid a lump sum off the mortgage and transferred the outstanding balance to Staffordshire, which is now Nationwide.

In the intervening years we paid most of the mortgage off and now have a small balance owing. We did this so we could have the bulk of the money from the endowment as a nest egg. The endowment has now matured and we are looking forward to receiving the money, which is around £26,000.

However, we have hit a hurdle. Zurich has written to us requiring confirmation from TSB that it has no interest in the endowment. It will not release the funds until it has this. We have written to TSB but we have not received a reply. I’d be so grateful if you could find out why we are getting nowhere with TSB.

– JR, Stockport

Dear JR,

You sent me the letter from Zurich that clearly asked for confirmation from TSB, as the “assignee”, that it had no interest in the endowment. Yet when I asked TSB to investigate, it said it had no record of you ever having taken out a mortgage with it. As the mortgage was taken out long before TSB separated from Lloyds in 2013, it was actually Lloyds that you needed to obtain this from, TSB said.

So your wife rang Lloyds, which was apparently very helpful. It asked for all the relevant policy details and successfully traced the mortgage. You said you were hopeful it would send the necessary letter to Zurich, which would get the ball rolling so you could get your payout. However, it wasn’t to be.

Weeks later you said you hadn’t heard anything from Lloyds or Zurich, despite promises that the issue would be dealt with. So again my intervention was required. I wrote to Lloyds on your behalf, asking what was going on. A couple of weeks later it got its act together and wrote to Zurich with the necessary information. It also paid £300 into your Lloyds account to apologise for the delay.

Then, around a week later, you finally received the £26,000 endowment money from Zurich, which came as a huge relief. At 49 you are still a way off retirement, but you are currently furloughed from your job as a gas and electricity meter reader so having this money is a comfort to you.

You plan to save the money in Premium Bonds until you retire at 65. This sounds sensible, as your wife is nine years older and will retire first, so she may need to dip into the money sooner. I wish you both all the best.

The full Katie Morley Investigates column will appear in print every Saturday and Sunday. You can get an early taste every Friday at 12:00