Endowment Policies After Death: How to Claim

Endowment policies were extremely popular in the UK from the 1970s through to the 1990s, often taken out alongside mortgages to repay the loan at the end of the term. Millions of older policyholders still hold these policies, and many executors encounter them when administering an estate — sometimes without fully understanding what they are or how to claim.

Types of endowment policy and how death benefits differ

Not all endowment policies work the same way. The type of policy determines how the death benefit is calculated:

• With-profits endowment: The most common type from the 1970s to 1990s. The policy builds up a sum assured plus annual (reversionary) bonuses and a terminal bonus added at maturity or death. On death, the insurer pays the sum assured plus all accumulated bonuses to date. The terminal bonus may or may not be included if death occurs before the policy matures — this varies by insurer and policy terms.
• Unitised (unit-linked) endowment: The policy value tracks the performance of an investment fund. On death, the policy pays the higher of the sum assured or the current fund value. In a falling market, the sum assured provides a floor.
• Pure protection (term assurance or mortgage protection): Some policies described as endowments are actually pure life insurance with no savings element. They pay a fixed lump sum on death within the term but have no surrender value. On death, the sum assured is paid.

Check the original policy documents to identify the type. The schedule page at the front of the policy will state the sum assured, policy type, term start date, and term end date.

How to trace older endowment policies when insurers have merged

The UK insurance industry has undergone significant consolidation over the past 30 years. Many well-known endowment providers — including Norwich Union, Commercial Union, CGU, Equitable Life, Scottish Amicable, and others — have been merged, acquired, or rebranded. If the policy was originally issued by a company that no longer exists under that name, you need to trace who now holds the liabilities.

The Association of British Insurers (ABI) operates a free Life & Pensions Tracing Service to help people find lost or forgotten insurance policies. You can submit a tracing request online at abi.org.uk or by post. The service searches across member insurers and will direct you to the current policy holder.

Common acquisition trails:

• Norwich Union → Aviva
• Commercial Union / CGU → Aviva
• Scottish Amicable → Prudential
• Refuge Assurance → Royal London
• Royal & Sun Alliance (life) → Phoenix Group
• Pearl Assurance → Phoenix Group
• Windsor Life → Phoenix Group
• Equitable Life → Utmost Life and Pensions

How to make a claim: documents and timescales

Once you have identified the insurer, contact their bereavement or claims team. Most insurers have a dedicated telephone line and some now accept online claims. You will typically need to provide:

• The original policy document (if available, though most insurers can proceed without it)
• A certified copy of the death certificate
• Proof of your identity and authority to act (as executor: a copy of the will and grant of probate; or, for smaller policies, a statutory declaration)
• A completed claim form (supplied by the insurer)

Typical timescales from notification to payment are four to eight weeks, though complex cases (particularly with-profits policies where bonus calculations are required) may take longer. Ask the insurer to confirm their target timescale at the outset.

Tax treatment of endowment policy payouts

The tax treatment of endowment policy payouts on death depends on whether the policy was a qualifying policy (most older with-profits endowments) or a non-qualifying policy:

• Qualifying policies: If the policy meets HMRC's qualifying conditions (generally: premiums paid for at least ten years, or three-quarters of the term if shorter; and the sum assured is at least 75% of the premiums), the death benefit is paid free of Income Tax. This is the case for most traditional with-profits endowments.
• Non-qualifying policies: Some unit-linked endowments and newer products may be non-qualifying. On death, a proportion of the gain may be subject to Income Tax in the estate.
• Inheritance Tax: Regardless of Income Tax treatment, the full payout value is included in the estate for Inheritance Tax purposes unless the policy was written in trust. If the policy was written in trust, the proceeds bypass the estate entirely and are not subject to IHT.

If there is any uncertainty about the tax position — particularly for non-qualifying policies or large payouts — seek advice from a tax professional or accountant before distributing the proceeds to beneficiaries.

What to do if the insurer cannot be identified

If you have found evidence of an endowment policy (for example, a premium payment on old bank statements, or a reference to a policy in old correspondence) but cannot identify the insurer, the ABI Life & Pensions Tracing Service is the primary tool to use.

In addition to the ABI service, try the following:

• Search the deceased's email inbox for communications from insurance companies
• Check bank statements for premium direct debit payments and trace the payee
• Look through the deceased's personal files for any policy documents, premium receipts, or correspondence
• Check whether the deceased received an annual bonus notice from a with-profits insurer — these are sent every year and provide the insurer's name and policy details
• If the policy was linked to a mortgage, contact the original mortgage lender — the policy may have been collaterally assigned to them and they will have records