Four out of five homebuyers with Friends Provident with-profits endowments maturing throughout 2005 will suffer a shortfall.
The situation is not much better at Scottish Widows, Clerical Medical or Norwich 
Union, where three in five policies will come up short. Standard Life will have around 50% of their policy holders with shortfall.
The crisis presents a terrible conundrum to others with endowment policies. Should they “Stick Twist or Fold?”
If you are sent a letter stating that your endowment may have a shortfall, don’t ignore it. You need to consider if it would be better to sell the policy, cash it in or keep going with it.
As a starting point ask you insurance company for a surrender value and a paid up value. If you ask for a projected value also it will send you the figures based on 4, 6 and 8% investment growth.
You would be wise to totally ignore the 6 and 8% growth rate projections until you see pigs flying past your kitchen window. Even 4% looks optimistic during the current climate.
We suggest that you speak to an Independent Financial Adviser for expert help and advice.
If you are considering switching to a repayment mortgage you may benefit from talking to one of our advisers.
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ENDOWMENT SHORTFALL