Help. Article in The Times Re: Hearts of Oak

dinky73

Hi

I'm new to this chat forum but was hoping I might be able to get some advice. I took out an Endowment Assurance with profits with Hearts of Oak in May 1998. I pay £77.21 a month and it's a 25 year policy, potentially paying out £50,000 in 25 years time (yeah right)!

Anyway, yesterday in the Sunday Times there was an article about how Hearts of Oak is in serious trouble with the FSA, basically on the verge of collapse. They were going to merger with Liverpool Victoria but that has now fallen through and things look bleak.

What should I do? Am I mad to keep throwing £77.21 at them every month? If they go bust will I get anything at all? Back in May last year I asked them for a surrender value of the plan and they said the Free Paid Value was £8268.97 and the Cash Surrender Value was £3647.42.

I suspect it would be pretty much the same if I asked again. Should I take the cash a bail out losing about 4.5K or stick with it in the hope some miracle happens. I think I have the option of also stopping any further payments but leaving the money there, or jumping ship.

Any advice welcome.
Thanks

dinks

dinky73

I thought this article may be of help in understanding what is happening with Hearts of Oak.

http://business.scotsman.com/banking.cfm?id=31802007

Thanks
dinks

dunstonh

low solvency usually results in low or no returns as they need to reduce the risk they take with the investments to ensure it doesnt get worse. Plus, they also need to increase their reserves so more of the return goes that way and not to the policy holder.

i would be looking to alter it now and not leave it too late.

EdInvestor

I would suggest you surrender this policy ASAP and extract your cash lest it get trapped.

Hearts is in a position similar to Equitable Life but seems much more likely to actually get closed down, as it is quite small and has failed to merge with Liverpool Victoria.

The FSA can't really let it trade while insolvent for much longer IMHO: it makes a mockery of the regulations.

Robert_Sterling

If it a good idea for you to jump ship then it might equally well be a good idea for others to jump ship too. Hmmm.