Standard Life has announced that it will compensate customers who invested in the Pension Sterling Fund and lost out in the 4.8 per cent fall in unit price, admitting that its Pension Sterling Fund literature has fallen short of its "usual high standards".

The insurer said the fall, which arose from shifts in valuations on 14 January 2009, affected 97,000 members of the fund, which was prior to the revaluation worth £2.1bn.
Standard Life said it had listened to feedback and concerns from customers and key business partners and will inject approximately £100million (£72million after tax) into the fund to put customers back into the financial position they were in prior to revaluation.

The group said this highlights their desire to attach to the long-term relationships they have with their customers and business partners, and also reflects their view that some customers would not have expected the value of their losses to be to this extent in one day, a figure estimated to be around £1,000.

Customers will also be able to inform Standard Life of any additional complaints they have in relation to this issue.

The Pension Sterling Fund will continue to operate as usual, investing in bank and building society deposits and gloating rate notes, the majority of which Standard Life maintains are asset backed securities.

John Gill, managing director of customer service, said: "Standard Life would like to take this opportunity to apologise to any customers who have been affected by the fall in value of this fund. In hindsight, some of the literature supporting the fund fell short of our own high standards, and it is important that we put this right.

"We have listened to our customers and advisers and believe that our response underlines our commitment to our long-term relationship with them."

- Pensions Age February 2009

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