What is an Endowment Sale?

An endowment sale is a transaction that takes place when an endowment policyholder decides to sell the policy. An endowment policy buyer is the entity who purchases the endowment, usually a company that specializes in making this type of purchase. An endowment policy is a regular savings or investment plan combined with life insurance in a single policy. If the owner dies before the policy reaches maturity, the endowment policy life insurance company pays out a specified amount of money.
There are a number of ways an endowment sale can take place. First, an endowment sale can be handled personally, with the policy owner contacting an endowment purchasing company. This type of endowment sale is fairly easy to complete, and most financial advisors will walk the policyholder through the process.
Another way to complete an endowment sale is at an endowment auction, or through what is referred to as a market maker. A market maker is a window through which endowment policy traders can make offers to purchase policies. It is akin to the stock market, but on a much smaller and calmer level. In this type of endowment sale, the policy trader can farm out the policy and get a better price by offering it in the open market.
There are two primary types of endowment policies: unit linked and with profits. A unit linked endowment policy involves monthly premiums that are invested into units. The value of this policy can fluctuate depending on the performance of the investment.
If there is strong economic growth, a unit linked endowment policy is the best option. If the market is down, however, so is the value of the endowment. The current value of the policy has an impact on the outcome of the endowment sale.
The more traditional endowment policy is the with profits variety. This type has a guaranteed value and will never go below a specific amount. This is the safer route for those not willing to take a risk with the unit linked policy.
Cashing in an endowment policy is a major decision. There are many alternatives to an endowment sale that are worth exploring before taking such a big step. Most individuals seek an endowment sale because of drastic changes in their circumstances, such as divorce or a change in mortgage arrangements. More recently, a low maturity projection by the endowment policy issuer has become another reason to carry out an endowment sale.

Source

Sell My Endowment

So you think you want to sell your endowment policy? Thats a big step - maybe you should consider your options before you dispose of a policy which you may have had for many, many years. After all most people who have endowments got them in the 1980's where they became particularly popular in the UK because of their tax treatment and, in particular, the high inflation of the time. So much has changed in the intervening decades. Read on too take a look at endowments and decide what are the best options for you, your mortgage and your your endowment policy.


Whether you are going to sell your endowment or not you should make a well-informed decision not a hasty one as this could have big implications for your financial future.
In this article I am going to look at what endowments are all about, what they issues with endowments are in today's markets, your selling options for endowments, and other options if you decide not to sell.

First off lets start at the basics what is an endowment policy? An endowment policy is basically a retirement investment and life insurance policy rolled into one. The general idea was that a home owner took out an interest-only mortgage on their property and this capital was invested in the stock market. The owner made lower repayments than with a regular mortgage because they weren't repaying capital. Instead the stock market returns on their investment was supposed to repay the mortgage at the end of a set number of years - usually 25.

Source

Should I Sell My Endowment Policy

Selling your endowment policy is a big step - something that you shouldn't rush into without a thorough financial analysis of the pros and cons of selling.  Once your policy is gone - its gone - your capital gains or losses are crystallized - you can't change your mind with this type of thing. In order to avoid living to regret the day you decided to sell your endowment policy - you should have written down exactly why you decided to sell and what assumptions you made that led you to that decision. You can't control the future and you certainly can't control what happens to the stock market, inflation, interest rates and other key financial indicators. All you can do is assume that everything will change and take the informed decision of the moment.

So lets look at the essential steps in the decision making process:

• why do you want to sell you endowment policy?
• what will selling cost you?
• what are your alternatives?
• which is the best decision.

Source