Norwich Union Endowment keep or surrender

Jules123_2

I need some more help please with a Norwich Union Endowment. I currently have a bank loan of £6,000 for which I’m paying £140.00 a month, at an interest rate of 6.99%. Would it be better for me to cash the NU policy in and payback the bank loan? I’m currently resident in the USA, where I have the bank loan, and at the moment and the exchange rate from pound sterling to American Dollars is $1.76.

Guaranteed sum assured: £4,224.00
Declared bonuses: £2,518.95
Surrender value: £5,846.00
Monthly premium: £20.41
Maturity date: 8/16/2009

Norwich Union told me that if the policy matures today, it would pay a TB of £218 per thousand.

Anyone have any thoughts please?

EdInvestor

Hi Jules

If you kept paying into the endowment to maturity you would get 6,742, plus whatever unguaranteed terminal bonus might be paid.

If yopu surrender and bank the money @4% also paying in the premium to maturity you should get 7,610.

The equivalent return @ 6.99% is 8,362.

Quite a big gap for the TB to breach: what kind of projections are they making @ 4% and 6%?