It seems the long-running problems home-buyers are having with endowment mortgages may require a change of tactics.

Repeated insurance company warnings policies might not cover the home loans of holders went largely unheeded.

With policies numbering 4.95 million among some 3.5 million holders, this attitude has astonished the Financial Services Authority (FSA), set up by the Government to champion consumer rights.

Disgruntled endowment mortgage holders are beginning to collect compensation payments.

The regulatory investigation into endowment mortgages by the FSA has awarded 11,000 homeowners more than £35 million, an average tax-free "windfall" of £3,360 each.

Winterthur Life has set aside a further £10 million for possible compensation in another 10,000 cases. Rivals could face bigger fines if they are slower to acknowledge problems.

These events pose the question: How many of those 4.95 million policies currently risking a shortfall could produce a successful compensation claim?

The authorities need to make the task look daunting to avoid a flood of claims but those who retain every document could build a compelling case.

In the Winterthur Life case, the FSA ruled that customers were entitled to compensation because they ticked a box on a computerised questionnaire when they took out the mortgage to say they regarded the certainty of the loan being repaid at the end of the term as being very important.

Brochures provided to home buyers might also establish a claim. FSA spokeswoman Christine Farnish suggests brochures that failed to warn the home loan might not be paid off by the endowment might be proof of mis-selling.

She said: "Complaints should go initially to the company which supplied the endowment mortgage. If that produces a stalemate, the complaint goes to the Financial Ombudsman."

Compensation might be payable in the following cases if:

The risks of an endowment were not fully explained.

Calculations were in any way incorrect.

Customers were unaware of risks involved because endowment policies were linked to the stock market.

Ombudsman Walter Merricks expects about 13,000 endowment mortgage complaints in the current year, against 9,000 last year.

On average, one complaint in ten at company level gets as far as him, which suggests there could be 130,000 endowment mortgage complaints in the pipeline this year.

Many complaints, said ombudsman spokesman David Cresswell, were from those who took out endowments in the financial year 1988/89, the start of the last property crash.

Mr Cresswell said: "Disappointment with the performance of an endowment is not sufficient grounds for a complaint. The vital question is whether bad advice was given and whether the financial circumstances of the customer at the time it was sold made an endowment mortgage inappropriate.

"If the ombudsman believes somebody was sold an endowment mortgage wrongly, because it was too risky or not fully explained, a claim may be upheld.

"Our method of compensation is to put people into the position they would have been in with a repayment mortgage from the start. In these cases, compensation might be the cost of putting them into a repayment mortgage, plus a small sum of cash for inconvenience caused."

When money is involved, it will usually be suggested that it is used to reduce the loan.

Between a half and a third of cases which reach the ombudsman result in compensation.

Successful claimants in endowment cases must switch to repayment loans. They cannot take the compensation and collect again if an endowment eventually comes up trumps.

It may be endowments are worth persevering with in the belief terminal bonuses will cover most of the loan.