Effective 1st April 2017

Bonus on your with with-profits Fund

There are two types of bonus which may be added to a with-profits investment. An annual or reversionary bonus may be added every year, although it can be more frequent depending on market conditions. A terminal or final bonus may be added at maturity, surrender, or upon death or when the money is moved out of the with-profits fund.

Annual Bonus Rates from 1st April 2017

When setting annual bonus rates a number of factors are considered, including the economic outlook and the long-term returns we expect our investments to earn in the future. Although equity markets performed strongly in 2016, economic conditions have been challenging and the UK base rate and interest rates in general remain at record low levels. However we are able to declare the interim bonus rates applying over 2016 as the annual bonus for 2016. In addition we have been able to keep the 2017 interim bonus rates for the majority of our policies the same as the final interim rates for 2016.

How are annual bonuses added to contracts?

For conventional with-profits business, the bonus is added as a percentage addition to the basic sum assured (or pension) plus attaching bonuses. For unitised with-profits business annual bonuses are added in two ways. Depending on the type of policy bonuses are added by either increasing the price of the with-profits units each day or by adding additional with-profits units to the policy. A combination of the methods is used for those Personal Pension Plan and Capital Investment Bond policies that have a guaranteed minimum bonus rate.

The Annual Bonus Rates in More Detail

Your annual statement will provide you with the information to identify your product and the fund series that you are invested in.

Product 2015 Declared 2016 Interim 2016 Declared 2017 Interim
Life Fund        
Endowment & whole of life 1.50% 1.75% 1.75% 2.00%
         
Capital Investment Bond - Series 1 3.75%* 4.00%* 4.00%* 4.00%*
Capital Investment Bond - Series 2 3.00% 3.25% 3.25% 2.75%
         
Flexibond - Series 1 3.50% Apr - Oct 3.75% Apr - Oct 3.75% 3.50%
From Nov 3.50% From Nov 3.50%
Flexibond - Series 2 3.50% Apr - Oct 3.75% Apr - Oct 3.75% 3.50%
From Nov 3.50% From Nov 3.50%
Flexibond - Series 3 3.00% Apr - Oct 3.25% Apr - Oct 3.25% 2.75%
From Nov 2.75% From Nov 2.75%
Flexibond - Series 4 N/A N/A N/A  2.25% 
Flexibond - Series 1A N/A  N/A  N/A  2.25% 
Flexibond - Series 2A N/A  N/A  N/A 2.25% 
Flexibond - Series 3A N/A  N/A  N/A  2.25% 
         
Vintage Bond - Series 1 & 2 paying for guarantee 3.50% Apr - Oct 3.75% Apr - Oct 3.75% 3.50%
From Nov 3.50% From Nov 3.50%
Vintage Bond - Series 1 & 2 opted out of guarantee 3.50% Apr - Oct 3.25% Apr - Oct 3.25% 2.75%
From Nov 2.75% From Nov 2.75%
         
Impaired life annuities in payment (Structured settlements) 0.90% N/A 1.80% N/A
         

Rates quoted for Flexibond and Vintage Bond products are gross of the annual management charge. The annual charge is applied after the addition of the bonus quoted in the table and has the effect of reducing the bonus rate quoted.

Rates quoted for Capital Investment Bond are after the allowance for the annual management charge.

*Rates quoted for Series 1 Capital Investment Bond are inclusive of the guaranteed accumulation rates 3%.

Product 2015 Declared 2016 Interim 2016 Declared 2017 Interim
Pension Business Fund
Conventional with-profits pensions        
Deferred Annuities 0.20% 0.20% 0.20% 0.20%
Pure Endowments 0.20% 0.20% 0.20% 0.20%
         
Accumulating with-profits pensions        
Personal Pension Plan (PPP) - Series 1 4.00%* 4.25%* 4.25%* 4.25%*
Personal Pension Plan (PPP) - Series 2 3.00% 3.50% 3.50% 3.50%
With-Profits PPP - Series 3 2.50% 2.75% 2.75% 2.75%
Personal Pension Account - Series 4 3.00% Apr - Oct 3.25% Apr - Oct 3.25% 2.50%
From Nov 2.75% From Nov 2.75%
         
With-profits annuities in payment 0.90% N/A 1.80% N/A
         
General Annuity Fund        
Agents’ pension arrangements 1.50% 1.75% 1.75% 2.00%
         
ISA Fund        
Shrewd Savings Plan ISA - Series 1 3.75% Apr - Oct 4.00% Apr - Oct 4.00% 3.75%
From Nov 3.75% From Nov 3.75%
Shrewd Savings Plan ISA - Series 2 3.75% Apr - Oct 4.00% Apr - Oct 4.00% 3.75%
From Nov 3.75% From Nov 3.75%
Shrewd Savings Plan ISA - Series 3 3.25% Apr - Oct 3.50% Apr - Oct 3.50% 3.00%
From Nov 3.00% From Nov 3.00%
Shrewd Savings Plan ISA - Series 4 N/A N/A N/A 2.50%
Shrewd Savings Plan ISA - Series 1A N/A N/A N/A 2.50%
Shrewd Savings Plan ISA - Series 2A N/A N/A N/A 2.50%
Shrewd Savings Plan ISA - Series 3A N/A N/A N/A 2.50%

Rates quoted for Personal Pension Account (Series 4) and the SSP ISA are gross of the annual management charge. Therefore the annual charge is applied after the addition of the bonus quoted in the table above and the annual charge has the effect of reducing the bonus rate quoted.

Rates quoted for Personal Pension Series 1, 2 and 3 are after the allowance for the annual management charge.

*Rates quoted for Series 1 Personal Pension Plan are inclusive of the guaranteed accumulation rates of 4%.

Capital Access Bond: Investment Band
Declared rates for 2016 and interim rates for 2017
£5,000 - £24,999 £25,000 - £49,999 £50,000 - £99,999 £100,000 - £249,999 £250,000 - £499,999 £500,000+
0.05% 0.05% 0.05% 0.05% 0.40% 0.45%