Aviva Endowment promise

dunstonh

What I find surprising is the difference between what I was told in May and the value I am now being offered

The final bonus adjustments happened after May though following the stockmarket low point which was in March.

I thought the idea of with profits was to smooth the final values thus avoiding large market corrections as you suggest.

Historically that was the case and it still does to some degree. However, the insurers have had to focus on solvency before returns and that has led to annual bonuses dropping and final bonuses being more volatile (in both directions). They have almost become balanced managed funds.

Have I go this completely wrong or am I not entitled to assume that if the first part of this year was much higher than now and as you say the first part of next year is likely to go higher than now that I am entitled after 25 years of paying to believe that the timing of my payout should not affect my payout so severly?

The smoothing effect still works ok on unitised with profits albeit wish some lag. However, on conventional with profits the lag can be 6-12 months.

Have your projections included your mortgage promise value?