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Thread: Endowment maturing soon, should I surrender?

  1. #1

    Endowment maturing soon, should I surrender?

    Hi all

    I'm after some advice regarding our endowment which is due to mature in June later this year....

    Same as most in our situation were promised enough to buy a yacht with the leftover funds way back in 1993!

    We've accepted that was bull and moved on from there, but the potential swing between high and low projected payout has me concerned.

    I called last week and was told that, assuming no major issues, I'd be looking at a payout in the region of 26,300

    I've called back today with another query and I was told that 26,300 is the high projection and 18,700 is the low projection; my payout could be anywhere between these two figures.

    Additionally, my surrender value on the policy is around 25,500 at the moment.

    Given the huge potential swing between high and low values I'm now considering cashing the policy in early.

    I did try to press on recent policy performance for any indication of likely swing but they weren't able to provide this, so I have a 7,600 swing to consider against a surrender value of around 800 less than the high projection.

    Any thoughts greatly appreciated.

  2. #2
    In 1993, no endowment had ever fallen short and maturities back then were coming in around 3-4 times the target value. No-one predicted the events that were to follow. However, you are better off with the shortfall than the surplus. So, its not all bad.

  3. #3
    As long as there's no bonus associated with it, I'd say yes surrender because it's far likelier to fall 10 or 20 % due to some overblown panic than rise the same amount. Rises gradual declines precipitous. As you have no time to recover from for example the panic of a couple weeks ago, cash it in.

  4. #4
    Surely, you can get a bit more information? What is the guaranteed sum assured on maturity, and what are the accumulated guaranteed bonuses? Add those two together, and that's the minimum payout guaranteed under the policy.

  5. #5
    Also check if there is a MEP (Mortgage endowment promise) this would only pay out if you held the policy til term.

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