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Friday, November 5, 2010

Sell Endowment Policy : Should I Sell My Endowment Policy?

I have found several advertisements in national papers recently from companies offering to sell my endowment policy. However, which is the best option to get the best return?

It is estimated that over 4 million with-profits endowment policies were sold by insurance companies in the eighties and nineties. These policies were designed to last for up to 25 years and increase in value each year as a bonus is added to the amount of money that you paid in every month plus an estimated big bonus at the end of the term. Most of these policies were estimated on annual bonuses accruing at up to 9%, however in reality, with the fall in interest rates over the last 10 years, most policies are currently returning less than 1% per year.

These with-profits endowment policies were sold as a means to repay an interest only mortgage at the end of the mortgage period. Industry experts now predict that 9 out of 10 policies will not reach their target figure to repay the mortgage. With nearly 4 million policy holders having been informed by their insurance companies of the potential endowment shortfall, there is a big market out there for Traded Endowment Policies.

Many people have now made other provisions for paying off there mortgage, like converting them to a repayment type where the monthly payments include both interest and capital. So what do you do with your old policy?

Selling your endowment policy may give you a better return than just to cash in or surrender your endowment policy. However you may want to replace the life insurance component with a more suitable product.

I decided to sell my endowment policy and I accepted an offer that was 10% higher than the surrender value so I was happy. If you think it is time to sell your endowment policy then make sure that you check out all your options, starting with contacting your insurance company to get a valuation. They will advise you on any alternative options that they can offer to you as well. Read more about what investigations I did before selling my endowment policy at http://SellEndowmentPolicyReview.com

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