The Association of British Insurers (ABI) are urging people who wish to pursue endowment compensation to make a claim directly to their endowment company, rather than using one of the many claims handling services available.

The ABI says that such services are no more likely to produce a successful claim than if a customer handled the procedure themselves - indeed, they cite figures that show 49% of independent claimants were successful, compared to 46% who used a claim handler.

The ABI also warn that many claim management companies can take up a large proportion of any compensation their clients receive with an average fee of around 25%, a figure which isn’t as widely publicised as the ubiquitous ‘no win no fee’ offer.

These fees can be avoided, say ABI, by making use of the free complaints process backed by the Financial Ombudsman Service.

While there is definitely something to be said for the ABI’s advice, it’s perhaps worth bearing in mind that they don’t necessarily see claims management companies as the greatest friends of the endowment industry, and are inevitably going to discourage their use.

The fact remains that many people are unsure about how to go about the whole complaints process, as with many areas of finance, and may feel that having someone take over the hassle of pursuing a claim would make the fees charged by a claim handler a worthwhile price to pay.

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