Clerical Med Endowment; sell or keep

Hoggtroff

I have a Clerical med endowment policy which I cannot get mis-selling compensation (bought before april '88). I have switched to repayment mortgage and was keeping the policy for when and if kids go to uni? I was wondering if it would be better to sell and invest in a equity based isa or similar. Details are; sum assured £10261, existing bonuses £7904 @ Dec 31st 06, Maturity Date 21/3/2013, monthly premium 37.20, surrender value £13765. Does anyone have any idea of recent terminal bonus values? CM will only say between 0% and 143%. I don't need the money but don't want to lock it into my pension, any advice would be welcome!

EdInvestor

If you surrendered the policy and put it on deposit @4.5% net return also paying in the premiums to maturity you would end up with 20,980.That's better than the guaranteed value of the policy at 18,165.

Ask for their forecast maturity values and compare with the one at 4%.If it's not higher than the cash return,then there's no risk premium for keeping the policy so you might as well get rid of it.The CM WP fund will likely make a 4% return, 5% at best.