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Axa removes MVRs on with profits bonds

Axa has removed market value reductions on its with profits bonds and announced improved with profits bonus rates for many of the 1.3 million customers investing in the Axa Sun Life With Profits Fund and the Sun Life Assurance Society With Profits Fund.

Regular bonus rates have increased by up to 1.5 per cent compared to the same time last year, and with profits bonds have increased in value by up to 16 per cent over the same period. Market value reductions have been removed on all products.

The increases follow continued improvements in investment returns, which saw the ASL With Profits Fund produce an 11 per cent investment return during 2006, while the SLAS With Profits Fund produced a 10 per cent return. Terminal bonuses have also improved resulting in an average 4% increase in overall payouts over the last year.

In addition, in view of the financial strength of the ASL Old With Profits Fund, a special bonus is being declared on policies invested in that fund. The bonuses are approximately 4.0 per cent for unitised policies and 2.5 per cent for conventional policies.

With profits actuary Peter Shelley says:
“The improvement in investment returns is now feeding through into higher rates of regular and terminal bonuses, continuing the trend that saw us increase rates twice during 2006. This is good news for with profits policyholders, who are now seeing further improvements in the payouts on their policies. The fund remains strong and is well placed to turn good stock market performance into further improvements in payouts.”

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