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…but market-makers see a massive boost

Traded endowment market-makers say the FSA&#39s new rule forcing life offices to tell policyholders about the option to sell their policy on the open market has provided a “massive” boost to the industry.

As a result of the regulator&#39s policy statement 106 introduced in September, Tep provider Surrenda-link says enquiries from people looking to sell their policies on the open market rocketed by around 50 per cent between August and September.

Breaking down the increase, it says it received a 31 per cent rise in enquiries from IFAs and a 76 per cent leap in those submitted online during September.

Industry trade body the Association of Policy Market Makers supports this finding, with figures showing it got an average of 4,461 enquiries a month between September 2001 and August this year but this jumped to 6,662 in September and 9,379 last month.

Beale Dobie agrees that PS106 has helped the market but says it had been growing since life offices started sending out endowment review letters at the end of 2000 which led to a 33 per cent jump in policyholders asking about their options.

Policy Portfolio managing director Brian Goldstein says: “Three factors in increasing enquiries are bad press around endowments, the FSA inviting policyholders to look at their options and then the major impact of PS106 on life offices.”

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