Surrender of Royal London life assurance endowment with profits

Nesty · 11 January 2017 at 12:20AM

In the 90’s I opened 4 fixed term life assurance endowments with then CIS. These ranged from 15 to 25 years.

I paid into these for a number of years (over 5 years). Then in 2000 I changed my bank account and CIS direct debits failed & the endowments were not collected. At the time I got on to the rep who took ages to come around, by that time CIS stated they couldn’t reinstate the direct debit contributions. CIS stated they would be frozen (I think the term was 'paid up' used). I would get a reduced sum at the end.

I currently receive update letters from Royal London now as they have taken on the financials from CIS. These mature in 2017, 2020, 2021, & 2024.

Is it possible to surrender these for payment now? The 2017 I’ll let that run as almost up. However, the others I would like to surrender if possible?

I do realise that there maybe a reduced sum involved. It’s just I can’t see much value being added for the future and I would like to if possible get my hands on the remaining funds.

Does anyone have any experience of these?

badger09 · 11 January 2017 at 3:10AM

The original policy documents should tell you if there is any surrender value prior to maturity.

If you don't have those details, why not ask Royal London?

PeacefulWaters · 11 January 2017 at 4:30AM

It's almost certain that you can surrender them.

It's most likely a poor idea to.

sheramber · 11 January 2017 at 12:48PM

Does your annual statement give a surrender value?

We used to have some endowments linked to our mortgage.

The last one we had- others had matured- the annual statement showed a surrender value for now and how much of we left it mature in two years time. The difference between the amount now and the expected maturity value was less than the total of the premiums we would pay for those two years.

We confirmed the surrender value with the company and went ahead and surrendered it.

Malthusian · 11 January 2017 at 12:55PM

Ring them up and ask them for the surrender values.

Also ask for the "basic sum assured", the "bonuses to date" and the "guaranteed value on maturity". The third number is usually the first plus the second but it doesn't hurt to check. This will tell you how much you are guaranteed to receive on the maturity dates and give you an idea of whether it is worthwhile to retain them that long or take the surrender value now.

You should also ask them how much they would pay out on death and, assuming that it is greater than the current surrender value, consider whether your family would be OK without this life cover or whether you could arrange alternative life insurance.

What do you need the money for?

Nesty · 12 January 2017 at 1:22AM

Thanks for the replies.
I trawled through some paperwork today and found some of the balances on some.
Basically the 'basic sum assured' hasn't moved in years due to the policys paid up approx in 2004.
The annual bonus on these ranges from £5-30 a year.
Anyway I got on the phone to Royal London and I can surrender if I want to. They going to give me written quotation for them. I'll see when that comes through & decide if it's worth it. Basically the policys won't give much more in the added value until end, so depends upon the surrender values.

Malthusian · 12 January 2017 at 11:51AM

Basic sum assured would only have moved once, downwards when you stopped paying into them. It's the bonuses to date which will have increased over time. In theory bonuses can still be added but on most endowments very few discretionary bonuses are still being added. Any return will come from what you are already guaranteed on maturity vs the surrender value now.

Nesty · 12 January 2017 at 12:27PM

Malthusian wrote: »

Basic sum assured would only have moved once, downwards when you stopped paying into them. It's the bonuses to date which will have increased over time. In theory bonuses can still be added but on most endowments very few discretionary bonuses are still being added. Any return will come from what you are already guaranteed on maturity vs the surrender value now.

Ok many thanks for this. Have to see how much they dock off now for surrender. Should know by end of next week if worthwhile or not.

Surrender of Royal London life assurance endowment with profits

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