Are long term anticipated endowment policies scams?

[Aventador]

I had an 21 yr anticipated endowment for $10k. Paid about $780 every year.

Every 3 yr, they send me a cheque of about $1k.

At maturity, I got a cheque for about $11k.

 

I don't pay more premium on the whole than what I got back, perhaps not as much.

 

But you must remember that you get insurance coverage during this period as well, which you will pay premium for a normal coverage.

 

I don't think this is a scam, anyone can work out the numbers.

 

so very roughly you collected about $16,380 and got back $18,000

 

that is not really an "endowment" , its just giving you back your money. and you lost money on inflation too

 

btw how much was the insurance coverage for?

 

these kind of business is fantastic - imagine if I sell plain water at $10 a bottle, and I say you drink already sure become slimmer and prettier 10 yrs later. But if you do not become slimmer or prettier, i can say it was just for illustrative purpose

[Wind30]

so very roughly you collected about $16,380 and got back $18,000

 

that is not really an "endowment" , its just giving you back your money. and you lost money on inflation too

 

btw how much was the insurance coverage for?

 

these kind of business is fantastic - imagine if I sell plain water at $10 a bottle, and I say you drink already sure become slimmer and prettier 10 yrs later. But if you do not become slimmer or prettier, i can say it was just for illustrative purpose

 

I think your maths is the best case as there is some ambiguity.

 

Example, did he get a 1k payment at the end of 21 years?? I don't think so. I assume 11k (10k+1k) was all he got so it amounts to $17k

 

How many $780 payments did he make? 21 or 22? if it is 22, then he paid $17.1k which is less than the $17k he got back....

 

go figure... considering you have to WAIT 21 years for such a payout it is really remarkable that ANYONE would sign up for it.... and at the end of the day still say it is a fair deal.

 

How much insurance coverage did he get?

Edited February 23, 2013 by Wind30