Projected Endowment short falls

dunstonh

, the insurance company conservatively says what to expect but then does not deliver

That is you making an assumption. The insurance company will never say that.

I feel I am talking to the FSA/insurance company. I was hoping for constructive advice and maybe to see how wide spread the problem is.

We cant help that you dont like the answers.

Would you rather we posted a load of rubbish in response but give you cuddles and say how right you are when its wrong?

Noselfdiscipline

Stribz wrote: »

I know I have only had a few threads but it is beyond belief how an average man on the street gets a predicted letter of maturity, the insurance company conservatively says what to expect but then does not deliver, then told by the FSA and members on the forum that the insurance company is not at fault and had no moral duty to inform policyholder, others saying why complain after maturity when I thought my mortgage was covered. The person who wants to deliver a grammar lesson needs to get a life, being new to any forum, I feel I am talking to the FSA/insurance company. I was hoping for constructive advice and maybe to see how wide spread the problem is.

Couldnt help myself, its one of my pet hates!

Anyway those letters are estimates based on 3 rates of return laid down by the FSA. They are not promises. This is because it is impossible to know what will happen in the future. The projections are not binding. In reality, endowments do not grow in such a linear fashion like those estimates would suggest. If you read the letter carefully, it will tell you that you could get more or less at maturity. And while the firm will tell you what they believe is a reasonable estimate of future return, this will be in relation to the long term, not the short term. Where the firm have slipped up perhaps, is sending a projection letter so close to maturity, as they are not a good guide to what happens in the short term.

The firm will send you an annual bonus statement, and a projection letter every two or three years. It is not practical to write to you every five minutes. As endowments are not guaranteed, you will simply get whatever you get at maturity. If its short of the target, they wont make up the difference. If the actual maturity value is lower than earlier projections, that does not represent a loss to you, because the projections were just estimates.

Hope that helps explain it a bit.