Anyone with a 25 year endowment which matured recently ?

my 25 year endowment with phoenix (royal and sun alliance) is due out in june 2014. i have been in touch with them ensuring everything is in place with them and i also asked what the payout including terminal bonus would be.
the original target amount was £34000 which i have for a long time realised was just a pie in the sky figure. having had the red warning letters for most of the duration of the endowment i was expecting a figure around £25k - my chin nearly hit the floor when the lady at phoenix said it was going to be about £19600.
i have asked in the past how the fund my money is in has performed and was told (and they confirmed in writing) previously that it was averaging approx 7.2%. i asked again if they could confirm this in writing and i today received a letter confirming the 7.2% growth.
i fully understand how an endowment works - the 7.2% growth isn't applied to my fund but annual bonuses are based on the performance of the fund and added to the guaranteed sum assured. annual bonuses are hideously low and this is 'justified' by saying this is to provide a smoothing when things arent doing so well and the small bonuses will be compensated in the terminal bonus.

i work out that a payout of £19600 on a monthly payment of £49 over 25 years works out at about 2.5% pa interest.
if the underlying performance of the fund is averaging 7.2% this works out at just over £40000. therefore, the final amount quoted is far from a fair sum.

i understand that an endowment has the life insurance element and there are managing fees to be paid but it seems to me that i have been sold short here. i have paid over £14000 in deposits and will be getting an extra £5000 in anual bonuses and terminal bonus while phoenix will be pocketing the other £21000!!

i don't consider that i was miss-sold an endowment nor do i have an underperforming investment tool - just the way it has been shared out is massively unfair.

i will be writing a formal letter of complaint to phoenix and hope i can follow it up with a complaint to fsa or the financial services ombudsman as i'm sure phoenix will not be forthcoming with a satisfactory explanation.

if anybody as any sugestions as to action i can take, i am all ears!!

thanks for listening!!

PeacefulWaters wrote: »

Poor investment performance isn't grounds for a complaint that will achieve anything.

Have you asked them (1) does the projected maturity value include terminal bonus and (2) what is the level of terminal bonus on 25 year policies maturing today?

yes on both counts. current terminal bonus rate about 30% of guaranteed sum.

i dont think 7.2% is poor investment performance!!

my gripe is they tell me the fund has grown at a rate of 7.2% and give me a return of 2.5%. is this a normal share of the growth by other endowment providers?

thanks for your reply.

prettypiglets wrote: »

Hi caseywhite


I would be interested to know the results of your Royal London Policy. I have one that also matures in December 2013 which I took out in 1989.


I did have a Policy on track green letter and I have called them to ask about a terminal bonus. They said that its not guaranteed but they do normally pay one out. I also have been told its a low start endowment and not a unitised plan. Hoping I get a bit more than the target amount of £40K

Hello again everyone.
I phoned Royal london yesterday i was told (but not guaranteed) that i may get £40,000. The woman said it could go up or it could go down. My premium was £81 a month.