Selling Endowment Policy & Endowment Sales - FAQS

What is a traded endowment policy, or TEP?

A traded endowment policy (TEP) is quite simply a policy that has been sold by the original policyholder to a third party. Usually these are investors who purchase the policy before it matures. As soon as the policy is assigned to a new owner, it is the new owner who pays the premiums until maturity. Further, all the benefits of the policy, including the death benefits, are passed over to the new owner.

Why would I wish to sell my endowment policy rather than surrender it to the insurance company?


Each policy will have a surrender value. This is the amount that the insurance company will offer you should you decide to surrender an endowment policy back to them. Due to charges and commissions, the surrender value of the policy can be sometimes less than the sum of what you have paid into the policy to date. If you are unsure what the surrender value of the policy is, you can contact the insurance company who will provide you with details of this.

Certain investors may put a larger value on the policy than the current surrender value. This means that they would be prepared to offer you more than the surrender value of the policy. If you have a with-profits endowment policy with a surrender value of £1500, it is worth obtaining a quote to see whether you would receive more money if you sell the policy rather than surrender it. It costs nothing to obtain a quote and you could receive up to 35% more than the surrender value by selling endowment policy in the second hand market.

How do I know my endowment policy is eligible?

Provided you have a with-profits endowment policy that has been running for at least seven years with a surrender value of at least £1500, we will be able to put your policy forward for a free non-obligatory valuation.

A number of additional factors come into play here, including the type of policy (only with-profits and whole of life policies can currently be traded) and the particular insurance company with whom you hold your policy. Some companies will offer higher surrender values than others.

Unfortunately, unit linked policies cannot be traded at the present time, as there are no investors who wish to purchase these types of policies.

If you are unsure whether your policy is unit linked or with-profits, check your last bonus statement. If it mentions units then it is probable a unit linked policy. If instead it mentions bonuses in sterling that it is probably a with-profits policy.

See if you can get more on your endowment by calling 0800 995 1006.