Traded Endowment Policies : There exists a way to sell second hand with-profits life assurance policies in which traded endowment brokers find best deals from purchasing market makers.
The point is that the redemption value of old endowment policies mid-term is usually below expectation whilst there are investors who wish to buy old policies which can be transferred between holders and kept running under new ownership until maturity.
Life policy holders have an option to trade policies in before the end of the contract and the policy holders can get improved offers for the policy they hold via competitive bids from the TEP brokers - traded endowment brokers.
This facility of use to home buyers and sellers who need to change their mortgage as they sell and rebuy new homes.
The market has recently been supressed with margins squeezed by the low interest environment of the last 18 months. Brokers have been unable to offer enough margin to warrant trades taking place.
However, TEP's or traded endowment policy surrender values appear to be back on the increase after experiencing a couple of years of stagnation, according to leading TEP brokers.
Now is the time again to try to get increased value your old endowment. The worst you can do with an old policy is usual to simply surrender it back to the original life company to obtain redemption value. But thats what the TEP brokers can do for you - to evaluate your policy and make an improved offer.
Traded Endowment Policies
Due to high charges by life assurance companies for early surrender endowment policies there exists a market for second hand with-profits policies in which traded endowment brokers find best deals from purchasing market makers.
Those that hold and wish to sell endowment policies have the option to trade policies in before the end of the contract. Policy holders are able to get improved offers for the policy they hold via competitive bids from the TEP brokers - traded endowment brokers.
Via a broker, TEP market makers, (traded endowment market makers) will assess the value of your endowment - the endowment surrender value. Then, if you decide to cash in endowment policy, the market maker takes on the monthly payments until the policy matures or they resell to another individual on the open market.
People who are changing their mortgage, going through divorce, need more capital or who predict a fall in the profit of their endowment may have a requirement to sell a with-profits endowment or life assurance policy.
Traded Endowment Policies or TEPs are second hand with-profits endowment policies legally assigned to new owners who pay the purchase price and take over the payment of future premiums. The life assurance cover remains on the original life/lives assured, but all policy benefits on maturity or, an earlier life assurance payout, are the property of the new owner.
As TEPs are purchased mid-term the policy already has a guaranteed value made up of the 'Basic Sum Assured' and 'Bonuses Attaching' and the initial charges have all been paid by the original policyholder.
From UKCity Media Published on June 25, 2010, 12:24 AM EDT
