Standard Life today announced a review of its UK with-profits bonus rates. Most plans have increased in value in the year to 1 February. Many customers are enjoying the benefit of valuable guarantees built up over the years on their with-profits plans.
As guarantees build up we have to ensure the with-profits fund remains strong and is able to meet all of these guarantees. We expect asset classes such as equities and property to offer better prospects for with-profits payouts in the long run but the higher the guaranteed benefits the more we may need to invest in lower-risk assets such as fixed interest and cash. We are therefore reducing some bonus rates from 1 February. These reductions mean that some with-profits unit prices will grow more slowly after today.
Margaret Flaherty, Standard Life's with-profits communications manager, said: "Despite the very unsettled market conditions we have seen over the last year we're pleased to say that most customers will see a year-on-year increase in the value of their plan. We have reduced the bonus growth rates for some plans from today to maintain investment flexibility over the long term. For many customers the guarantee continues to be a very attractive element of their investment.
"How this review affects individual customers depends on many factors, including their age when their plan started, and the timing and amounts of payments into their plan. We write to our customers each year to give them details for their plan, including bonus rates and up to date plan values. Most of our customers can also access details for their plans online."
Ends
Download the press release (PDF, 141kb).
For further information, please contact:
Patricia Corrigan - Standard Life
Direct: 0131 245 5916
Mobile: 0774 092 4558
Email: patricia_corrigan@standardlife.com
Notes to Editors
The Standard Life group is a leading provider of long term savings and investments to almost 6 million customers worldwide, of which over 1 million are with-profits customers.
All information and figures in the press release refer to UK with-profits plans and products.
Further information on Standard Life?s approach to bonus rates and payouts is explained in its Principles and Practices of Financial Management (PPFM). The full PPFM document and consumer friendly versions can be found at www.standardlife.co.uk/withprofits.
References in this press release to Standard Life are references to Standard Life Assurance Limited, a wholly owned subsidiary of Standard Life plc.
For more information on with-profits asset mix and investment returns please refer to the quarterly investment reports which can be found at www.standardlife.co.uk/withprofits.