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Traded Endowment Policy ::

A TEP (Traded Endowment Policy), also known as a SHEP (Second-Hand Endowment Policy), is a traditional with-profit endowment policy, which the original policyholder has sold on to a private or institutional investor, by absolute assignment of all future benefits, for a better price than the surrender value his life company has offered.

The first endowment with-profit policy was sold in 1843. Initially it was the institutional investors, such as investment trusts and pension funds, who invested in TEPs. However, it didn't take the general public long to recognise that selling an endowment policy could benefit both the seller and the buyer. Even so, in those days trading was conducted mainly through auction houses.

The big breakthrough for the TEP market came at the end of the 1980s when a handful of companies in the UK, called Market Makers, started specialising in buying and selling TEPs to and from the public. As trading in policies increased in popularity, the number of Market Makers rose and turnover in the trade of TEPs increased from about £5 million per annum in 1988 to currently about £400 million per annum.

Now the market consists of a number of well established Market Makers (examples include 1st Policy, AAP, Neville James, PolicyPlus and SurrendaLink), which are members of the APMM (Association of Policy Market Makers) and regulated by the FSA (Financial Services Authority).

Note: If you're interested in obtaining a quote from these companies, the Endowment Check Comprehensive Endowment Report contains an optional current market valuation you can use for free, to obtain a competitive sales price for your policy.

In addition, Endowment Check has well established links to potential investors outside the UK who are constantly looking to buy Endowment With Profits Policies for their investment portfolio.