View more on these topics

Equity falls hit Widows’ WP bonuses

Scottish Widows has cut bonuses by up to half after its with-profits fund fell by 17.5 per cent in 2008 due to a 54 per cent exposure to equities and property.

Widows has reduced regular bonus rates on most of its conventional and unitised with-profits policies by half. Final bonus rates for conventional and unitised with-profits contracts have fallen as much as 63 per cent compared with 2008.

With-profits actuary Kevin Doerr says: “2008 was a very difficult year for global markets and has highlighted the advantages of a diversified investment strategy, smoothing and with-profits guarantees. Coming into 2009, the with-profits fund held 54 per cent in equities and property, a balance between prudent management and being well positioned to gain from market recovery by retaining significant exposure to these asset classes.”

Hargreaves Lansdown pension analyst Nigel Callaghan says: “The with-profits fund took a pretty big hit due to its high equity exposure but if markets bounce back, it is well positioned to benefit.”

Recommended

Truestone in gilt alert

Truestone is concerned that sovereign bonds could burn yield-seekers this year and is looking to gradually reduce its clients’ exposure to the sector.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com