Quote Originally Posted by python
When I took out my endowment mortgage policy in 1987, I was informed by the salesman(who worked for a market leading company) that when it matured it would pay the mortgage and the extra would buy me a holiday, or a new car, etc etc..
About 10 years ago , I received a letter informing me of a shortfall, a £12,000 shortfall, we made a mis-selling claim and their only offer was £3500, take it or leave it, leaving the final repayment £8,500 short.

In my opinion, endowment policies were sold, as a product, for the intention of paying off a mortgage, the fact hat they do not
makes them not fit for purpose , the financial institutions should have been obliged to at least cover the mortgages of their customers...>
Toph absolutely nowt personal mate but just my opine regarding endowments

Never understood the liability by providers for these endowments not maturing at the level expected.

I had one and was told that it'd probably pay extra but I paid enough in to ensure that the amount was sufficient for mortgage cover. When they were taken out there were 3 interest rate/growth levels predicted for the amount people paid in and as with all investment the wording did state the possibility of a low return [value can go up or down]. In addition there was a guaranteed payment on death if that were to happen which I considered to be of particular benefit...not that I did croak ;D From memory about £40/month would reach £22k in 25yrs [pay in c£12k]

I am pretty sure the majority of claims have only been made due to the info and widespread publicity resulting in plenty 'jumping on the bandwagon' by people paying in a minimum looking at the highest level final value prediction and then bleating that the figure isn't going to be reached..........jeeeezus even a woman in a bank who is well versed in investments made a claim. The majority of these claims were made against policies still running so the actual final amount was not known anyway as there was only a 'possibility of shortfall'. If left until maturity many policies would meet the predicted final value but not the highest predicted value....in fact there was a good bit of business to be had by buying part paid policies.

Don't believe they are sold anymore.

anyways that's endowments, mortgages, pensions covered ;D ........ what next on Flys interesting finances thread...which indeed it is 8-)