LV has revealed their 25-year endowment policy covering a £50,000 mortgage is currently paying a surplus of £16,592.
For a customer aged 30 next birthday at entry, the maturity value for a 25-year low cost mortgage endowment maturing on 1 March 2014 is now £66,592, the provider revealed.
As at 31 December 2013, the LV with profits fund had 47 per cent invested in equities, 8 per cent in property, and 4 per cent in venture funds.
LV’s results fly in the face of those who, as sister publication Money Management reported back in 2008, took endowment mortgages off the advice radar when the regulator expressed concerns about the way the product was sold.
Providers were required by the then Financial Services Authority to send out letters to policyholders with an indication of how likely their policy is to match the mortgage loan at maturity colour coded according to how much the shortfall is likely to be.
Philip Moore, group finance director of LV, said: “We are pleased to be reporting a high level of investment return of 11.1 per cent for our members this year. This is 2.5 per cent above the market benchmark.
“With profits remain an attractive investment proposition for certain market segments and we are committed to offering great returns to our customers.
“This excellent performance and the possibility of additional mutual bonuses continue to benefit existing with profit members as well as for our new propositions - our pension income plus annuity and our flexible guarantee bond.”
