Endowment Advice Needed Urgent!!! Phoenix

stuart1978

Hi people,

I am seeking as much advice as i can for my parents who are having a very difficult time with the surrender valuation from Royal Sun Alliance who merged to Phoenix regarding their endowment policy.

My parents took out an mortgage endowment plan on 28/01/1992
the maturity date for the plan was 28/01/2017.

On the 20th November 2008 they recieved a red alert letter from Phoenix advising of a High Risk of shortfall.

The Target amount of the policy was £22,800. The letter advised that a shortfall of £11,500 was predicted and that they should take action to repay that amount.

The letter advised not to surrender the policy as they may lose out financially.

Too cut a long story short on the 15th October 2008 they asked for a surrender valuation for the policy which was given at £6166 (they have paid in over £8000 to date) they foolishly took no action at the time. They have now changed mortgage to a re-payment mortgage and cannot afford to pay both the new mortgage and the endowment policy.

They asked for a surrender value quotation this week and have been advised that to date the surrender valuation of the policy is now £2,864 and advised that this is due to the current economic climate.

Obviously this is a devasting blow to my parents and would like as much advice as possible to possibly rectify this situation.

Please help they are desperate....


Many Thanks

EdInvestor

Post some details about the policy

Guaranteed sum assured
Declared bonuses
Surrender value
Monthly premium
Maturity forecasts
Interest rate payable on mortgage

dunstonh

from Royal Sun Alliance who merged to Phoenix

Wasnt a merger. R&SA sold their closed life book to Phoenix. R&AA still exist but retail mostly general insurance nowadays. Mostly under the name More Than although you still see R&SA on some things.

They have been pretty awful for a long time now. The minute someone mentions them the answer it almost a forgone conclusion.

stuart1978

Sorry Guys i'm a bit in the dark with this stuff...

On the original proposal from Royal Sun Alliance it states the following:

Class of Policy: 25 Year Economy Plan (joint Life)

Sum Assured:

stuart1978

Sorry Guys i'm a bit in the dark with this stuff...

On the original proposal from Royal Sun Alliance it states the following:

Class of Policy: 25 Year Economy Plan (joint Life)

Sum Assured: Basic Sum Assured £7,524 with profits
Min Death Benefit £22,800

Mortgage Amount £22,800

Monthly Premium £39.26

Free Life Cover

The company will provide cover of £22,800 free of charge from the later of 9th December and whichever of the following applies:

1 House Purchse
2 Home Improvment

The policy will include a re-arrangement option of £50,000

My dad is just getting some more info form his files... Hang tight guys

Cheers

Stu

stuart1978

Trouble here is guys is that they had a financial guy approach them about a no win no fee claim for a mis-sold policy a few years back and they gave him a lot of documentation...

He never returned the complete set of documentation after he advised them that they were beyond the time limit for claims so a lot of info is going to be missing here. I know the maturity forecast is missing.

The declared bonus for 2006 (which is the last we have to hand at the moment was £2189.14 that was a yearly bonus of £9.71 added.

Sorry i can't be of any other help. I will add more info as we find it

Thanks again

Stu

stuart1978

Guaranteed sum assured - £7,524 plus bonus
Declared bonuses - 31.12.2007 - £2198.86
Surrender value - 02.02.2009 - £2865.49
Monthly premium - £39.26
Maturity forecasts - Not Available
Interest rate payable on mortgage - Variable rate

Does this help guys!?

EdInvestor

You'll have to ring them up for the maturity forecasts. Get them to recheck the surrender value while they're doing that. A fall over the past 6 months was to be expected, but 50% is rather high.

What is the interest rate on the new repayment mortgage ?

stuart1978

Thanks Ed,

your help is much appreciated. Unfortunately the department is only open Mon - Fri so i can't get any info till Monday.

Will post an update then

Many Many Thanks

Stu

jm28cardiff

Bear in mind that the surrender value is the amount the company allow you to take out of the fund early, so it does go up and down over the life of the policy. If the policy is kept to maturity, the basic sum assured and bonuses already declared are guaranteed to be paid in full.