cancelling life premium

madmoon

We have 2 endowments originally taken out to pay off the mortgage. An inheritance meant that we were able to pay off the mortgage in 2001 but have retained the endowments. Now on a pension we want to retain the endowments but cancel the life assurance and not pay the monthly premiums.
No problem with Barclays but Legal and General say that if we cancel the direct debit we will be considered as surrendering the policy. Obviously this is not a good time to do this.
Any experience of getting round this problem?

dunstonh

Go back to them again and ask if the policy can be made "paid up". This is where premiums cease, life cover stops but the investment remains invested.

If there are no surrender penalties then taking the surrender value and reinvesting into an ISA could be the better option.

roguebrogue

dunstonh wrote: »

Go back to them again and ask if the policy can be made "paid up". This is where premiums cease, life cover stops but the investment remains invested.

Only if it's unit linked this is possible.

If it's one of their conventional endowments (usually called 'build-up plans') then it won't be, and after 12th months of missed premiums then it would be automatically surrendered.

Retired_I.F.A.

I find that hard to believe, for over a hundred years if you stop payments on an endowment it automatically becomes paid up. Same goes for a unit linked policy which came about in the 70's. You have to ask and sign for a surrender value.

roguebrogue

Edited because I was wrong