Thousands Lose Their Right To Compensation - March 2010

Many were never told there was any risk their mortgage would not be paid off and now face shortfalls which in some cases run into tens of thousands of pounds.

As a general rule, policyholders have three years from the date they receive their first high-risk "red" shortfall letter in which to make a complaint. After that point the firm can potentially dismiss or "time-bar" the claim, meaning that the policyholder loses their right to compensation altogether.

So far, hundreds of thousands of consumers have fallen foul of the time-barring rules and hundreds of thousands more will miss out on their deadlines if they don't act soon.

Policyholders need to pay close attention to the re-projection letters sent out by their insurance companies, as these will often give a specific date by which they need to complain.

But do not fall into the trap of thinking that you have "all the time in the world" as it is all too easy to tuck the letter away in the kitchen drawer and forget about the clock that has started ticking.

Even those who have already cashed in their policies should think carefully about whether the advice they originally received was suitable.

If you have already tried to claim and have been time-barred then you only have six months from the date of the decision letter to raise an appeal. Given the complexity of the rules it may well be worth taking specialist advice.

Above all you must act quickly, or face joining the thousands of mis-selling victims who have already been denied their rights and will never see a penny of the money they have lost.

*Source: Simon Bowers - EMCAS - March 2010

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