Oct 17 Standard Life Plc said Britain's
financial watchdog has asked it to review whether it gave
customers in poor health enough information when it sold them
The Financial Conduct Authority (FCA) has told the insurer
to review its sales of annuities sold since July 2008 to see if
customers eligible for higher payouts because of a shorter life
expectancy were properly informed about their entitlement.
The request follows an industry wide review by the FCA,
which on Friday said that a "small number" of insurance firms
could be subject to penalties for their selling practices.
Standard Life said it was not possible to estimate reliably
the level of redress it might have to pay as a result of the
review, but that it had made a provision in its 2015 accounts
for potential customer compensation.
The FCA said on Friday that while it had found no
industry-wide problem of annuity mis-selling, some firms may
have to pay compensation to customers who should have been sold
a different type of annuity -- a form of pension that pays out
until death. In cases where a customer would have been eligible
for an "enhanced annuity", lost income ranged from 120 to 240
pounds ($150-300) a year.
Standard Life, which has been a participant in FCA's review,
said it was possible that the financial impact of any
compensation may be mitigated by its professional indemnity
Standard Life's shares were down 3.6 percent to 325 pence by
0324 GMT, making it the third top percentage loser on London's
FTSE 100 index.
(Reporting by Esha Vaish in Bengaluru; Editing by Rachel