I have a 20y with profits policy with Scottish Provident -Phoenix

I took out a 20year "with profits policy" with Scottish Provident -(now Phoenix) in 2000 about €80/pm. The idea was that it would from an education fund for our children.

I enquired recently and have been told by Phoenix that if I were to cash it in it would be worth less than the amounts paid in!

What should I do? If i leave is there a possibility that the guys that stayed in might enjoy a bonanza at the end? Are there alternatives to cashing it in? Can I make it paid up?

Where could I get independant professional advice?

Binomial said:

I enquired recently and have been told by Phoenix that if I were to cash it in it would be worth less than the amounts paid in!

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Have you been receiving an annual statement sowing you as to how the Policy has been performing or hasn't ? This is important as Policy holders are meant to receive an obligatory statement once per year.

In case you were not aware these type of Policies are Commission driven. Hence the poor return.

If you are looking for independent opinion, be careful that your inquiry is not sidetracked to another Financial Products Sales person, which could leave you back in the same position. One thing I am certain of, is that no Policy can achieve enough to make up for lost earnings -- You might have to change your direction to Financial Products like ETFs which are not commission driven and could allow your money to work with the chosen markets and not towards uncaring Sales people.

Most of the with profit policies taken out in the last ten to fifteen years seem to be loss making entities. You may be better off cashing it in and taking your losses or try selling the policy on to another company where you might get slightly more. Search online.

With profits policies cannot fall unless a market value adjustment is being applied. Some of the profits are also held back in the form of terminal bonuses which will kick in at the end of the policy. If you cash in, you will lose under both, and those that stay will get your benefits (minus charges). You need to get the policy reviewed and obtain details on charges, commissions, MVA, terminal bonus etc.
You may be able to just make it paid up and wait until maturity.
Eagle star with profits policy is the only one to my knowledge never to have implemented a market value adjustment.

rocksider said:

With profits policies cannot fall unless a market value adjustment is being applied.

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Sure this is a contradictory statement. The Assurance companies have a marvelous ability to sell the product with guaranteed returns but n the basis of things not going to plan, make overall deductions to the policies.

Funny these market value adjustments never effect the companies results but only the policy holders. Good enough reasons to invest into more direct investments without fancy charges.

No arguments with you merc. The way the MVAs have been applied is like some sort of three card trick. However MVAs DONT apply on the maturity of the policy, and so this can be a "get out". And as i said Eagle star deserve great credit for never having had to apply a MVA, although the converse of this is that their funds are generally invested more cautiously.