Legal – General – Endowments and savings plans bonus declaration, endowment life insurance.#Endowment #life #insurance

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Endowments and savings plans bonus declaration.

With profits endowments and savings plans performance history

The table below shows the investment returns for the assets that specific with profits endowments and savings plans invest in, over the last five years.

Unitised life policies including:

  • Capital Accumulation
  • Capital Investment Portfolio
  • Capital Preservation
  • Flexible Investment Plan
  • Flexible Mortgage Plan
  • Flexible Protection Plan
  • Unit Savings (Prospects and New Savings Plan)

Conventional life policies including:

  • Build Up
  • Cash Builder
  • Endowment
  • Low Start Build Up
  • Progressive Build Up Plus
  • Progressive Flexible Build Up
  • Progressive Investment
  • Treasure Chest
  • Whole of Life Plan

Performance is for calendar years, 1 January to 31 December. The investment returns shown are after tax but before we have taken off investment expenses and any plan charges. Please note that all investment returns are rounded to the nearest percent.

Past performance is not a guide to future performance.

With profits endowments and savings plans investment mix

The money invested in a with profits endowment or savings plan is combined with money from other with profits investors in the With Profits Fund. The With Profits Fund invests in a mix of assets, such as UK and overseas shares, fixed interest securities and commercial property.

While everyone is invested together in the With Profits Fund, the investment approach may vary depending on the type of plan held. This may be for a number of reasons, one of which is to reflect the features and benefits of different with profits products.

The table below shows the asset mix for our with profits endowments and savings plans as at 31 December 2016.

ASSET MIX AS AT 31 DECEMBER 2016

FIXED INTEREST SECURITIES

Unitised life policies including:

  • Capital Accumulation
  • Capital Investment Portfolio
  • Capital Preservation
  • Flexible Investment Plan
  • Flexible Mortgage Plan
  • Flexible Protection Plan
  • Unit Savings (Prospects and New Savings Plan)

Conventional life policies including:

  • Build Up
  • Cash Builder
  • Endowment
  • Low Start Build Up
  • Progressive Build Up Plus
  • Progressive Flexible Build Up
  • Progressive Investment
  • Treasure Chest
  • Whole of Life Plan

Factors affecting the bonus amount

Investment returns, less any tax applicable, are the most important factor in deciding how much bonus we pay. These depend on the mix of assets your policy is invested in and how these assets have performed.

We also consider the following:

  • Historic investment returns experienced over the period of your investment.
  • Bonuses already declared.
  • Our view of future investment conditions.
  • When you started your policy.
  • The effects of smoothing.
  • The type of with profits policy you have and the terms of your policy, including the type and extent of any guarantees.
  • Money built up in the With Profits Fund that is over and above what we expect to need for future obligations such as tax, expenses and future bonuses to policyholders.
  • The costs of running your policy.
  • Any other adjustments, for example to cover an increase in the cost of guarantees and options. For the bonus declaration for 2016, there will be no adjustments.

With profits plans are designed to smooth returns. Smoothing means that in years of good investment growth we may hold back some of the investment returns, so that we can top up bonuses in years where the performance is not as good. This means that the returns, or bonuses, added to a plan over the years will not be the same as the returns shown in the table at the top of this page. You can find more information on smoothing in our Understanding Smoothing (PDF: 44KB) factsheet.

It is worth remembering that the value of your investment can fall as well as rise and you could get back less than you invested.

Need to get in touch?

If you have a query about your with profits product, please give us a call or send us an email.


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