Traded endowment market maker, Absolute Assigned Policies (AAP), has unveiled an online valuation s...
Traded endowment market maker, Absolute Assigned Policies (AAP), has unveiled an online valuation service that allows IFAs to track the value of a clients' endowment policy on the open market.
The service is free and can provide IFAs with an instant quote showing how much AAP considers the policy to be worth. This can hugely reduce the time taken to manually process an endowment valuation. The valuations are on average 15% higher than the surrender value offered by the original product provider, but can be as much as 35% higher.
Should the client decide that they want to sell their endowment, it can be processed within 10 to 14 working days, and t he IFA will receive 3% of the value of the policy in commission.
Lee Portnoi, chief executive of AAP, said: "The average surrender value is £10,000, so if we come in at £11,500 then everyone is happy."
"We have a large group of institutional investors who buy endowments off us. They pay the provider and when the policy matures the investors get the benefits. They are usually fairly low risk, safe investments," he added.
Meanwhile, pan-European retail finance company MyNewDeal has announced the launch of the Forward Endowment Guarantee Mortgage, which guarantees the future purchase price for endowments at outset and will purchase just before the policy matures.
The price is guaranteed and is free from any conditions that relate to the overall market performance. Any positive returns can be locked in if the policy is performing well, but if there is an expected shortfall, the deficit can be curbed and plans can be made to meet the difference. Because the plan is sold at maturity, the policyholder is not penalised and can keep any associated benefits, such as life assurance.
The product is the result of research commissioned by MyNewDeal, which found that 58% of the 11 million UK endowment holders questioned plan to re-asses the performance of their policy this year.
