Could I buy a second hand endowment policy privately?

Could I buy a second hand endowment policy privately?

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elanfan

Original Poster:

5,516 posts

226 months

Monday 2nd May 2016
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As per the header really. Is there anything to stop me advertising locally for someone that might want to sell their endowment to me privately?

I'm thinking the seller won't have to pay a TEP company any fees nor will I so we're both winners. I am aware I'd need a signed deed of assignment and have to take on the remaining payments, get a current surrender value etc.

Does it have to be done through a financial institution? Can I do it direct with the seller?

Ginge R

4,761 posts

218 months

Wednesday 4th May 2016
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If you really want to do it, you can consider buying through http://www.foster-and-cranfield.co.uk .

Probably be more efficient than going solo.

vanordinaire

3,701 posts

161 months

Wednesday 4th May 2016
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I'd considered this from a slightly different point of view. One of my relatives has two policies which have 5 years to run, he is getting impatient and is considering cashing them in. They'd make a good investment from my point of view but wasn't sure if I could take them over.

Jockman

17,912 posts

159 months

Wednesday 4th May 2016
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vanordinaire said:
I'd considered this from a slightly different point of view. One of my relatives has two policies which have 5 years to run, he is getting impatient and is considering cashing them in. They'd make a good investment from my point of view but wasn't sure if I could take them over.
Get him to ask for an encashment value. Ask them to pay particular attention to the terminal bonus.

Pretty sure you will not be able to take over the life assurance part but happy to be corrected.

elanfan

Original Poster:

5,516 posts

226 months

Thursday 5th May 2016
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Well it seems no one has suggested you can't do it privately so to answer the question posed above. It makes it easier that you know the person because that way you get to know if they died and can then claim the payout as the policy would have been legally assigned to you. The bit that might be difficult is that when it matures you may find that they get a bit pissed off with you for making a profit out of them. The relatives could see it as you making a profit out of their death if they don't live until maturity.

Looking at the major player Surrendalink they have various policies for sale with varying prices, maturity dates, continuing premiums and issued by various life offices. They quote a surrender value and also locked in bonus values. They obviously build in a profit for themselves in the asking price and then quote what they think is the likely maturity value. The potential profits look good but then they would wouldn't they! It all depends on the final bonus declaration at maturity date which could be higher or lower than projected. Different insurers have different levels of success at investing the money and there must be a level of uncertainty.

I fought if it were possible to cut out the middleman you'd be a lot more certain of making a decent profit. The pitfalls of doing it privately I guess are getting a legally acceptable Deed of Assognment (that the Life office will accept) and that the surrender values etc are what the seller claims them to be.

Anyone have any experience of buying one privately?

HRH2009

174 posts

177 months

Saturday 7th May 2016
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Yes you can buy an endowment policy privately. Well, I did about ten years ago.

The person selling had them 'valued' by one of the companies that traded these policies. I took them over at that offer price they made.

As you say the level of the terminal bonus is a bit of a gamble. Though having said that I was more than happy with the purchase and final outcome of the policies I bought.

I do remember talking to someone in the assurance world and they were of the opinion that policies with the largest companies ie Prudential, Aviva were the safest buy.

elanfan

Original Poster:

5,516 posts

226 months

Tuesday 10th May 2016
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How did you go about getting the policy assigned - the legal stuff?