Newsgroups: uk.finance
Subject: Re: Endowment policy bonuses
From: alan.frame@acm.org (Alan Frame)
Date: Fri, 21 Jul 2006 00:53:14 +0100

tim  wrote:

> "Trevor"  wrote in message 
> news:44bf5e8a$0$3502$ed2619ec@ptn-nntp-reader01.plus.net...
> >I find endowment policies totally bewildering. If a policy pays 2.5% bonus.
> >Can this be compared with the 5% you can get in a Cash ISA?
> 
> You will get an annual guareteed bonus which cannot
> be taken away and a terminal bonus at the end.  Historically,
> the terminal bonus on a 25 year policy is approaching 100%
> so that's an extra 4%. Whether this is likely in the future
> is another matter, but even if it's lower than this, you can't
> compare the two

True, but it's entirely possible that one can get an annual bonus - say
to Nov 2005 of 0.5% - and if you don't like it and want to escape
Norwich Union, then they'll hit you with a 33.43% MVA...

(Not an endowment mortgage, a WP penson policy from 1993, maturity 2032)

If the OP is considering a WP endowment, then they should immediately
complete an EPA before they are sectioned.

HTH, Alan
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