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Endowment surrender ?
Comments
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Hi Imacf
If Standard Life didn't actually sell you the policy, the duty of care issue doesn't apply.Trying to keep it simple...0 -
shrewdal wrote:Hi, I RECEIVED COMPENSATION FROM FRIENDS PROVIDENT AND DIDN'T HAVE TO SURRENDER THE POLICY BUT I DID HAVE TO AGREE THIS WITH THEM FIRST AS THEY PUT FORWARD THE POINT THAT IF I WAS SEEKING COMPENSATION FOR A POLICY THAT WAS UNDER PERFORMING WHY WOULD I WANT TO KEEP IT....I WROTE TO THEM AND SAID I WAS GOING TO KEEP IT AS A SAVINGS PLAN AND THEY WERE OKAY WITH THIS....I DON'T THINK THEY CAN MAKE YOU SURRENDER YOUR POLICY AS THEY DON'T HAVE CONTROL OVER YOUR PERSONAL PAPERS...
I have a FP policy, since 1991, for 25 years. Just been awarded misselling, did you want to keep the FP policy for a reason? Is it worth keeping it?
Thanks.0 -
Hi Pjala, I decided to keep the policy as it is 16 years old and only costs £5.15 per month as I had been encouraged to take this out with double glazing!!!hencethe reason I got compensated. I found the staff at friends prov very helpful and when I asked to keep the plan going they were okay about it. I think if you are reasonable with them and don't give them grief they will be okay..Good luck0
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Ok, mine is for 60 per month, so is significant if FP is going to underperform any more. My idea is that I have paid into the charges which are upfront, so surely the rest must be profit? My cash in value currently is just over £9000.0
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Hi pjala
Post some more details so we can take a look.I assume it's a With profits policy?
What is the Guaranteed sum assured plus Bonuses total so far?Trying to keep it simple...0 -
Sorry, I have finally got around to posting policy detais:
Current surrender value: 9472
guaranteed amount plus bonuses: 20890.13
maturity date: 29/11/2016
monthly premium: few pence short of £60
My way of thinking is:
4x60 + 11x12x60 to pay in before maturity = 8160
guaranteed amount is 20890-9472= 11418
so nominally the difference is the growth on my 60 per month guaranteed now, 11418-8160=3258.
But if I invested the 9472 at 5% over the next 11 years 4 months, plus the interest at the same rate from the 60 per month.....
The 60 per month over 11yrs 4 months would be worth 10665.77, calc at 5.15% (in an ISA).
The 9472 (actual amount put in calculator 9400) invested in a 5% fund for the same time (136 months) would be worth 16547, so add the two together and you get 27,212! This is much more than the guaranteed amount!
But will the fund pay out bonuses?, plus in a letter they say investment growth, they predict, will be 5.5% comfortably. Plus I get life cover for 42,500.
So you can see the confusion....
thanks for any help.
NB used this calculator to get some of my figures:
http://www.moneymatterstome.co.uk/Interactive-Tools/GeneralInterestCalculator.htm0 -
Hi pjala
If you put the surrender value in the bank @4% up to maturity, also paying in your premiums to maturity, you would get 24,501 compared with the guaranteed value at the moment of almost 21k.[IMHO 4% is a more realistic net rate to use for an 11 year period.]
Given that the guaranteed rate will almost certainly rise a bit over the period, that there might be a small terminal bonus and the policy contains free life cover, there's very little in it ,to my mind.
You might like to check the cost of replacing the life cover to see how much value is in that. Also, you could get a better "rate of return" if you are paying a higher interest rate on your mortgage than 4% and used the money to pay it down.
Otherwise I think I'd be inclined to keep the policy as a small stockmarket punt - you can't really lose much as the guaranteed value is respectable and you never know, you might make a worthwhile extra gain.:)Trying to keep it simple...0
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