The Financial Services Authority has published a consultation document on relaxing time bars for mortgage endowment complaints.

The proposals aim to "significantly reduce the risk that some endowment policyholders who were mis-sold policies might have missed the opportunity to complain because they did not realise they had a claim and failed to act in time".

Forum Response: Association of British Insurers

Stephen Sklaroff, deputy director general of the ABI, said: "This research largely confirms our own understanding of the performance of the mortgage endowment market and will help bring a much-needed sense of perspective to this issue. Recent reductions in interest rate payments on endowment mortgage more than balance lower investment returns.

"The vast majority of consumers are taking appropriate action when they have a projected shortfall. Where there is a possibility of policies having been mis-sold, the current arrangements for redress are working.

"From our own research, we know that the majority of customers who face a shortfall have either made other arrangements to cover the difference, or have more than 10 years to pay off their mortgage.

"Recent reductions in interest rates mean that someone taking out a £50,000 endowment mortgage in 1998 is now paying £90.30 less per month in interest payments. To make up a projected shortfall of £5000 over ten years requires additional saving of just £34 per month."

Forum Response: Consumers' Association

Mick McAteer, senior policy adviser for Consumers' Association, said: "The announcement by the FSA is welcome, but consumers need help not words at this stage. The FSA must provide clear information to consumers who may have been mis-sold an endowment mortgage on how they should go about seeking redress.

"Consumers' Association's and the FSA's research found that only a minority of mortgage endowment holders say they were properly advised of the risks of taking out a mortgage endowment policy. Yet the FSA's new research has now found that the majority of mortgage endowment holders have not complained to their provider and that perceived mis-selling is the most common cause of dissatisfaction with endowment policies.

"The FSA's own findings indicate just how much work remains for the regulator to do. It is not too late for the FSA to redeem itself by following our plan of action to make sure that everyone who is entitled to redress gets it."