Nic Cicutti's Personal Finance column

LIKE MILLIONS of home buyers in the Eighties, I took out a with- profits endowment to pay the capital off after 25 years. I expect it to deliver a tidy sum when it matures in about nine years' time.

I barely notice the money leaving my account now but at the start the monthly payments were a huge burden, taking almost 10 per cent of my salary.

I often considered surrendering the policy back to the life insurance company. It was more luck than judgement that I did not. Now I'm past the half way mark it makes no sense to stop.

Many of my fellow borrowers surrendered their policies for the usual range of reasons; unemployment, divorce, or they simply had no further need. When they did sell, they often found the policy was barely worth what they paid in.

In truth, endowments are a "clunky" way of saving to buy a house. They need a long-term commitment which defies the daily reality of most people's lives. They are completely inflexible, levy a fortune in charges (to pay vast commissions to those who flog them) and their fiendishly complex structures make it impossible to work out exactly what you are likely to receive upon maturity and why.

Anyone with half an ounce of imagination could have worked this out, particularly the life insurance company executives who were busy marketing these products to all and sundry. All that didn't stop armies of sales staff with negligible training scouring the country to find suckers like me to buy their rubbish.

That is why I feel little sympathy for insurers who, if rumours are to believed, face police inquiries into whether the sale of many of these policies were tantamount to fraud. They deserve all they get.

What also concerns me is the approach of our financial watchdogs. There was no effective regulation of life insurers prior to the late Eighties and it is now recognised that the weak regulatory regime between 1988 and 1994 allowed mis-selling on an epic scale. But from 1994 onwards, we had the Personal Investment Authority, supposedly a better class of watchdog. During that time, endowment sales continued at an alarming rate. Even today - with a new regulator, the Financial Services Authority, in place - they are still the preferred means of repayment after 25 years for up to one third of new borrowers.

This is frightening. Is it not possible to fix it so advisers cannot sell an endowment unless they can show their client's circumstances are unlikely to change in the next 25 years? I can think of just two categories of people, to whom this might apply: clergymen and life prisoners. Any other suggestions?