Breach of Contract by a Company in respect of a With Profits Endowment assurance

Hi, sorry for the long post but heres my problem :-

For the purpose of the below questions, I have included wording used on
policy documents and received statements, at the end of the
circumstances and questions below.

The Circumstances.

I purchased an Industrial With profits Policy in 1991 with a rather
large financial orginastion. I was told that the policy would be worth
near £12,000 when it matured. ( Nothing obtained in writing though )

As the policy matured, I discovered that a significant amount of money
in bonuses had been removed from the policy and money that I had been
paying for at least five years, had been used to "protect other members
contractual rights"

However, checking through my original policy booklet, I saw words which
I believed protected my rights and any removal of any bonus would be a
breach of contract.

I have complained to the firm who have rejected my claim, I have
written to the ombudsman who also have rejected my claim.I am at the
stage of appealing against the ombudsman decision.

The investment company offered no explanation on the words that you
will see below that were written on my policy document.

The ombudsman stated that my policy booklet was never intended to be
read in isolation. ( Which Is the only document, in my opinion forms
the legal bases of a contract between me and the investment company.)

My questions are these...

1) If there are words written on original policy document that state
any bonuses alotted are additions to the sum assured, do the investment
company have the right to remove a bonus or series of bonuses once it,
or they have been declared ?

2) There is nothing contained in my original policy document that
states there is a likely I would be making payments to "Protect other
memebers contractual rights." Therefore am I right in thinking that,
any admission by the company, that they have performed such a move is
beyond the terms of my contract, therefore breaching what is written in
my policy.

3) If indeed it is decided that both the above situations amount to a
breach of contract, can I claim a loss of potential investment because
they removed bonuses and diverted my regular monthly payments elsewhere
?

4) If the ombudsman appeals process were to find against me, what would
the chances of a succesful "small claims court claim be? " : The amount
I am claiming is less than the £5000 limit.

HERE IS THE WORDS WHICH I THINK SUPPORT MY CLAIM...


I received the policy booklet with stated the following words in the
schedule.

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Sum Assured : ********* payable on the ******* 2006 or earlier
death of the Assurred.

With Profits : This policy participates in profits and any bonuses
allotted shall be at the rates declared for 'series A1' policies as
additions to the sum assured

PREMIUM £***** due on the *********** and then monthly until
************ The premium shall cease on the earlier death of the
Assured.

Payments under this Policy : All payments arising out of this policy
shall be payable to the proposer or legal representative or lawful
assignee of the proposer and shall be made in the currency of England
at the registered office of the company which currency and place of
payment shall also apply to payments due under this policy.

--------------------------------------------------------------------------------------------------------------------------------

In the earliy years, I was receiving yearly statements that had the
following words written on them


Reversionary Bonuses : These are permanent addtions to the sum assured
and are payable whenever the sum assured becomes payable.

Terminal bonus : A Terminal bonus has been declared for certain
policies which becomes claims by death or maturity of the endowment
period on or after ******** and before ********* The terms and
condtions of any terminal bonus for participating policies becoming
claims on or after ********** will be detrmined year by year as a part
of the annual division of profits.

The amount of bonuses standing to the credit of any policy is
determined by the rates of bonus which have been delcared from time to
time and the policy holder is entitled to such amount, any error or
omission in this certificate notwithstanding. Where the policy contains
any conditions affecting the bonus additions, this certifcate is given
subject to those condtions and subject to all premiums due on or before
********* having been paid. This certifcate should be retained and kept
with the policy.


In 1996, the wording on the certificates I received changed which got
rid of all the words you have seen above and replaced with a completely
different set. The words which are relevant to my question are set out
below.

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FINAL BONUS - We may pay a final bonus on your policy when it matures
or if the life of the assured dies. The amount shown is not fixed and
we may review it.

-------------------------------------------------------------------------------------------------------------------------------------

In 2000 a significant sum had accrued as a FINAL BONUS. but the words.


FINAL BONUS - We may pay a final bonus on your policy when it matures
or if the life of the assured dies. The amount shown is not fixed and
we may review it.

------------------------------------------------------------------------------------------------------------------------------------

IN 2004 words had changed again which read :

Sum assured - The sum assured is the basic guranteed benefit of the
policy. When the policy comes to an end ( Matures ), or if the life of
the assured dies, we will pay at least the sum assured, provided that
all the premiums due have been paid.

Existing bonuses - These are permanent bonuses that have been added to
the policy and are guranteed to be paid out in full, if the life
assured dies or when the policy matures, provided that all premiums
have been paid.

Your annual bonus for 2004 - To ensure all existing policyholders'
contractual benefits are protected, we have been unable to increase
your guaranteed benefits, by adding an annual bonus to your policy for
2004

Please read this statement along with your policy condtions.

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The 2004 annual statement showed the final bonus had been removed, the
total value of the policy had only increased by £100 even though 48
monthly payments had been made

and finally in 2006, the maturity figure was only £300 greater than
the total amount of the policy that was declared at the end of year
2000, even though 60 monthly payments had been made between 2000 and
2006.

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My argument is this, no matter what name you place on a bonus, whether
it be terminal, final, special news, reversionary, annual or otherwise,
according to my policy schedule, ANY bonuses alotted are additions to
the sum assured and cannot be removed once alotted.

Therefore the company has acted outside the terms and conditions of my
policy which has sufferred financial distress due to their actions


Any advice please ?


Thanks

.

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