Selling Endowments Get more than the surrender value!

November 13, 2013

Selling Endowments

Filed under: — alanslogs @ 12:50 pm

For many years endowment policy holders who wanted to cash in their endowments early simply contacted the life assurance office selling endowment policiesand accepted their surrender value. Then the word started spreading that there was another way, and meant more cash in the policy holders pocket.

The alternative was selling endowments and it soon caught on. Today the traded endowment market is thriving with institutional buyers snapping up the unwanted endowment policies for canny investors who realise that with the majority of the premiums already paid, they only have to coast home to the end of the endowment policy term to collect the funds

Selling endowment policies instead of surrendering endowment policies is quick and easy with most being paid put in under a week. It only takes a few minutes to enter the endowment policy details for submitting to the endowment traders.

Obviously if the endowment policy is performing well then it would be unwise to dispose of it, but if you have received a warning letter saying that action needs to be taken, or there will be a shortfall, then it is time to act. Whether than means topping up the endowment by paying higher premiums, running another savings scheme alongside it to bring it up to target, paying off a chunk of your mortgage to bring that down to meet the endowment value, or disposing of it and using the cash to clear some of the mortgage and change the rest to repayment. There are many options, and it needs a bit of thought, but if you want to see what your endowment is worth to an endowment trader, and whether he will buy it you do decide to sell the endowment, then click above for a decision.

By clicking on the flashing logo above you can send your details to one of the 6 UK traders that are members of the APMM (Association of Policy Market Makers).

Here is what the Financial Services Authority has to say about selling endowment policies : “If for whatever reason you’re thinking of surrendering or cashing your policy in, make sure your endowment company tells you about ALL the options – that includes the option of trading the policy in as well as surrendering it, if it has been running for at least five years.”

The statistics show that there are a significant number of endowment policy holders that do not keep their endowment policies to maturity. They cash endowment polcies early or sell the endowments to traders.

The majority of endowment policies used to repay mortgages were taken out on a joint life first death basis. This means that there are two people named on the endowment and if one dies the other gets the death benefit. However, the more likely scenario is that they will both be alive when the policy matures and then the proceeds are shared.

But what happens to the administration of the endowment policy if the couple split up, as many do? There is still a need to keep up the premiums if they want to share the proceeds at maturity, but in reality because they have separated the more usual case is for the policy to be surrendered for cash, or assigned to only one of them who continues to pay the premiums. This means that the solo owner ( the one it gets assigned to) now gets the payout if the other one dies but not the other way round. The death benefit is now paid into the deceased persons estate and goes wherever the last will and testament dictates. If the solo owners survives to the endowment policies maturity date then that person gets the full value of the fund.




1 Comment »

  1. very useful site for someone who wants to sell endowments. Take a look at mine –

    Comment by alanslogs — December 8, 2013 @ 11:45 am

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