Standard Life Endowment and MEP calculation

Sandybanks

My 25 year £30,000 endowment ended on the 1st September 2013.
I learned several things that maybe of use for people with them still to mature.
If you sign up online to monitor its value which I recommend, make sure you take screen grabs as you go because once it matures it all disappears as though you never had one.

As mine was coming to the end i was trying to work out how much extra I would need to pay in to cover the shortfall. Apparently Standard Life cannot tell you the figure until 3-5 days after it matures which as others have said will cause you to pay interest while the mortgage provider waits to receive the cheque. Why they cannot tell you seems a mystery because on the 19th of August the value was the same as it was when it matured 10 days latter the only difference was that they added
£1144 (5.7%) MEP.

For those of you had similar Standard Life policies which matured before June it seems you were unlucky. On 29th July it showed online that my policy was worth £19,228.40 by the 5th August it had jumped to £19,989.50 that's an increase of 4%.

Can anyone explain how they calculate the MEP? My partner has exactly the same one as me as it was split 50/50 for the total mortgage value. She has all the same figures on her final statement with the exception of the MEP, mine is £1144 and hers is only £884.00. Perhaps Standard Life are sexist!

Sandybanks

To anyone looking at this I can confirm that all the figures on the last yearly statement are exactly the same except the section where it says about the MEP. The range of values both the lower and the higher are £300 greater.
I have no idea why this should be.

dunstonh

Older Std Life endowments couldnt run off accurate projections. For a period, it was actually possible to get Std Life projections where the lowest projected value was lower than the guaranteed minimum maturity. They fixed this after a period by just increasing the projections where that happened. It was then possible to see projections on the lower and medium growth rates as being the same. My understanding was that on older plans, they could not project using the annual and final bonus accrued to date. So, instead they were using the surrender value to project from.

Perhaps Standard Life are sexist!

They would have been until December 2012. Cost of life assurance over the term would be different for male/female. Whilst this has now been banned for new business, it does not apply to plans set up prior to Dec 12.

Sandybanks

Thankyou dunstonh,

I'm just trying to get a better understanding of how it works. So the yearly statements from Standard Life have an estimate of some elements on them which wont actually be known till the policies mature?
I thought that the investment part of them would be identical and the small difference in premium paid was for the term insurance which reflected differing risks for insuring male and female.
If both pots of investment money were in the same fund they should return the same investment but perhaps they do some adjustment at the end depending on the real cost of the risk they have had to insure against.

I suppose there is no way of checking to see if they have made a mistake in their calculations as they don't provide their workings on the matter.

They do make mistakes with the calculations because several moneysavers have reported getting cheques years latter from Standard Life saying they made an error when they valued the policy. This would mean at the time they payout they could have been challenged and the payout would have been in error.

I know there is a thread where people with Standard Life endownments have been posting the maturity value and it looks like they need to include the sex of the policy holder.