Mortgage holders cheered as margins improve in traded endowment market
2010/06/24 - Endowments - 0 Comments - 257 words
Traded Endowment Policies : There exists a way to sell second hand with-profits life assurance policies in which traded endowment brokers find best deals from purchasing market makers.
The point is that the redemption value of old endowment policies mid-term is usually below expectation whilst there are investors who wish to buy old policies which can be transferred between holders and kept running under new ownership until maturity.
Life policy holders have an option to trade policies in before the end of the contract and the policy holders can get improved offers for the policy they hold via competitive bids from the TEP brokers - traded endowment brokers.
This facility of use to home buyers and sellers who need to change their mortgage as they sell and rebuy new homes.
The market has recently been supressed with margins squeezed by the low interest environment of the last 18 months. Brokers have been unable to offer enough margin to warrant trades taking place.
However, TEP's or traded endowment policy surrender values appear to be back on the increase after experiencing a couple of years of stagnation, according to leading TEP brokers.
Now is the time again to try to get increased value your old endowment. The worst you can do with an old policy is usual to simply surrender it back to the original life company to obtain redemption value. But thats what the TEP brokers can do for you - to evaluate your policy and make an improved offer.
More info....
Traded endowment policies step through
Dont surrender old with-profits savings plans, trade endowments on the TEP market
2010/06/04 - Endowments - 0 Comments - 293 words
Traded Endowment Policies
Due to high charges by life assurance companies for early surrender endowment policies there exists a market for second hand with-profits policies in which traded endowment brokers find best deals from purchasing market makers.
Those that hold and wish to sell endowment policies have the option to trade policies in before the end of the contract. Policy holders are able to get improved offers for the policy they hold via competitive bids from the TEP brokers - traded endowment brokers.
Via a broker, TEP market makers, (traded endowment market makers) will assess the value of your endowment - the endowment surrender value. Then, if you decide to cash in endowment policy, the market maker takes on the monthly payments until the policy matures or they resell to another individual on the open market.
People who are changing their mortgage, going through divorce, need more capital or who predict a fall in the profit of their endowment may have a requirement to sell a with-profits endowment or life assurance policy.
Traded Endowment Policies or TEPs are second hand with-profits endowment policies legally assigned to new owners who pay the purchase price and take over the payment of future premiums. The life assurance cover remains on the original life/lives assured, but all policy benefits on maturity or, an earlier life assurance payout, are the property of the new owner.
As TEPs are purchased mid-term the policy already has a guaranteed value made up of the 'Basic Sum Assured' and 'Bonuses Attaching' and the initial charges have all been paid by the original policyholder.
For more information on cashing in endowment policies check ukcitymedia pages. There is a link to the traded endowments section in the left nav bar, at the bottom of the home page.
Life insurance giant Prudential pulls plans to buy AIG Asian : AIA
2010/06/02 - Company Reports, Endowments - 0 Comments - 189 words
Prudential, who scrapped plans to buy AIG's Asian arm AIA last week, are under pressure from institutional shareholders to make changes on the board. The papers are hinting today that chairman Harvey McGrath and chief executive Tidjane Thiam could end up moving on after the proposal fell apart.
Chairman Harvey McGrath indicated that the board withdraw its interest after failing to negotiate a reduction to the $35.5bn price tag for AIA. Correspondingly, the Pru's plans for a $21bn right issue will now also be scrapped.
AIG rejected the Pru's revised proposal last wednesday in which the offer price was cut from $35.5bn to $30.75bn. AIG chief executive Robert Benmosche agreed in principle to the revised terms, however the rest of the board voted 10-2 against. AIG will now revive its earlier intention for a partial listing of AIA on Hong Kong stock exchange.
Prudential could now faces penalties as well as costs associated with the deal. Break fees of £153m will will be applicable whilst the Pru can also expect to pick up the considerable tab for underwriting, advisory and other fees likely to be close to £300m.
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