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If you decide to sell your endowment mortgage how does the process work and what do you need to do it?

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Selling your endowment policy - FAQs

If you decide to sell your endowment mortgage, how does the process work and what do you need to do it?

myfinances.co.uk sets out the key facts relating selling an endowment.

Can I sell my policy?

Typically only with-profit and whole of life endowment policies can be sold. Endowments that are unit-linked or "unitised policies" cannot be given a long-term value because of the way they are set up.

The life company behind the endowment, the length of time a policy has been in force and its surrender value are also factors.

Generally, with-profits endowment policies which have been in force for at least five years, with a surrender value of at least £1,500 can be sold on the market for more than their surrender value.

What do I need to have to sell my endowment policy?

The following information is needed to sell an endowment policy, it can be obtained from your life company.
  • Name of insurance company/life company
  • Type of policy (with-profits/unit-linked)
  • Policy number
  • Start and maturity dates
  • Basic sum assured
  • Total bonuses declared
  • Date to which bonuses are declared
  • Current surrender value
  • Gross premium payable and premium frequency (i.e. monthly etc)
  • Name and address of life (lives) assured

    How long will it take for me to get a quote?
    With the above information to hand, you can get a valuation for your policy within 24 to 48 hours.

    If you do not have all the information to hand, it can often be found out by the prospective buyer, without obligation. All they would need is your written authority to talk directly to the life company on your behalf.

    Does it matter if the policy is linked to a mortgage?
    No.

    Whether the policy is worth more than the outstanding loan, or if the loan is being repaid in other ways it does not stop you from selling your policy.

    Who covers my premiums after the policy is sold?
    Policies are generally bought by large institutional investors who tend to hold the policies until they mature. After the policy is sold you have no obligation to pay any more premiums.

    When do I stop paying premiums

    You are generally responsible for paying premiums until the next month after the agreement date. However, this information will typically be covered the offer letter you receive.

    How long will it take?
    Once an offer letter is issued it must be signed before the transfer procedure can begin.

    You then have to complete a simple transfer form and supply some additional information and documentation.

    There are no costs or charges attached to this, and the process should take about the same time as it would take to surrender the policy.


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