Almost two out of five people do not understand that there is a link between stockmarket performance and the return on endowments, according to a poll by Autif.
The poll reveals what Autif calls a dangerous lack of know ledge about endowments even among mortgageholders, with just 39 per cent aware of the link with share performance.
Director of communications Anne McMeehan says: "This level of ignorance about endowment policies is but a specific example of a general ignorance of financial products."
Autif is conducting a study each month to measure consumer knowledge and understanding of basic financial matters and products.
Sixty-two per cent of men with a mortgage showed correct knowledge of endowments compared with 46 per cent of women.
People in the 25-34 age bracket were better informed than older groups.
The Autif results come in the wake of warnings from the Faculty and Institute of Actuaries that current low inflation and investment returns could lead to some endowments delivering less than half their expected return.
McMeehan says the mix of possible lower returns and lack of understanding of endowments is "a potentially dangerous cocktail".