Question to the HM Treasury:

To ask Her Majesty's Government what assessment they have made of the impact of endowment policies maturing during the pandemic on the number of people who are left with a shortfall and cannot repay their mortgage; and what steps they are taking to support such people.

The Financial Conduct Authority has said that, in light of COVID-19, insurers must consider very carefully the needs of their customers and show flexibility in their treatment of them.

Consumers should check the terms of their individual policies and contact their provider if they wish to make changes to their policy.

The Government encourages customers who are concerned about the current financial situation to get in touch with their lender or insurer at the earliest possible opportunity to discuss their options.

On the 17 March, the Chancellor announced on behalf of the sector that banks and building societies will offer a 3-month ‘mortgage holiday’ for borrowers that are financially struggling with their repayments. This forbearance measure will enable affected borrowers to defer their mortgage payments for up to 3 months while they get back on their feet. In addition, the FCA issued guidance confirming that this captures borrowers whose mortgage is in a closed book or owned by a firm that is not regulated for mortgage lending.

Furthermore, lenders have agreed a 3-month moratorium on possession action to start immediately to provide customers with reassurance that they will not have their homes repossessed at this difficult time, meaning firms cannot commence or continue repossession proceedings against customers at this time.