This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. Find out more here.
X
Categories:Pensions

Phoenix to hold annual with-profits bonuses at "low to nil"

  • Print
  • Comments (2)

Phoenix has warned investors to expect annual bonus rates on with-profits funds to remain “low or nil” in the next few years as the closed life firm gives priority to final bonus rates.

Annual bonus rates on the majority of conventional with-profits life and pensions policies managed by the firm were nil this year.

However, Phoenix increased annual bonus rates on former Royal Life traditional pension policies from 0.2 per cent in 2011 to 1.5 per cent this year. Annual bonus rates for former Scottish Mutual Assurance unitised with-profits pension policies also rose from 1 per cent to 3 per cent.

Despite targeting higher final bonus payments, Phoenix concedes a “significant” number of policies will receive no final bonus because the benefits already guaranteed are higher than the value of underlying investments.

Final bonuses have been added to a number of the funds managed by the provider, including former Britannic Assurance OB policies.

Phoenix chief executive Mike Merrick says: “We have continued our practice of enhancing final bonus rates out of surplus money in those funds which have excess assets.

“In other cases, our emphasis remains on ensuring that the funds are safely managed so that we can deliver on our commitments to meet the guarantees already given and to ensure customers are treated fairly.”

Phoenix manages over 3.25 million whole of life and endowment and 2.25 million pensions.

  • Print
  • Comments (2)

Daily Email Updates
If you enjoyed this article, sign up to receive the latest news and analysis from Money Marketing.

The Money Marketing CPD Centre
Build your annual CPD - you can log and plan your CPD hours for free with The Money Marketing CPD Centre.

Taxbriefs Advantage
Advantage is a digital reference source giving unbiased, independent, answers to your technical queries. Subscribe to Taxbriefs Advantage.

Readers' comments (2)

  • Just goes to show all that guff when Phoenix bought out all those failing providers about strength in numbers and lower management costs leading to better profits was just that , a load of guff.

    Unsuitable or offensive? Report this comment

  • Can't seem to get an answer to 'What is the Terminal bonus per £1000 on a 15 yr traditional Britannic OB endowment if it were to mature today !!!!!!!!!
    Is it a state secret? Phoenix would not give the information to my colleague!

    Unsuitable or offensive? Report this comment

Have your sayEdit my profile/screen name

You must sign in to make a comment

Fund Data

Editor's Pick



Poll

Do you think other insurers will follow Legal & General and quit the ABI?

Job of the week

Latest jobs

View all jobs

Most recent comments

View more comments