These with profits policies
were designed to pay a lump sum on the death of the policyholder, hence the "whole life" part of the name.
The insurer said it was revising the final bonuses it paid on some of its with profits policies, reducing their maturity value by between five per cent and ten per cent.
With profits policies are long-term investments which smooth out stock market volatility by holding back some returns in good years to pay out in bad ones.
That's one surprise in a survey of with profits policies which seemed ( not long ago ( a sensible way to save a sizeable lump sum.
There are three types of with profits policies: endowments designed to pay off mortgages, regular saving schemes and lump sum bonds.
Insurance giant Prudential announced it was cutting bonus rates on its with profits policies
last month, and other groups including Norwich Union, part of Aviva, Standard Life and Legal & General have also made reductions.
A COMBINATION of the "Equitable Life Effect" and a volatile stock market has raised concerns about one of the most popular forms of investment in the UK - with profits policies
FIRST Scottish Endowments says it pays out pounds 2,000 more on average for with profits policies
surrendered early, than life offices.
Investment experts have been giving me off-the-record warnings about with profits policies
For traditional with profits policies
(Industrial Branch and Ordinary Branch), this is paid once a year and increases the sum assured.
Because so-called with profits policies
are linked to the performance of shares, they are supposed to be managed in a way which smooths out the highs and lows of the stock market.
An NOP poll of 500 owners of with profits policies
- the type which would qualify them to vote - found 87 per cent in favour of a ballot and nearly 60 per cent said they would favour conversion.