Winterthur Life – Universal Sipp
Type: Full Sipp
Minimum investment: £1
Investment choice: Choice of 41 funds from Winterthur, Baillie Gifford, BGI, Deutsche, Gerrard, Schroders, ABN Amro,Credit Suisse, Exeter, Fidelity, Gartmore, Invesco Perpetual, Jupiter, Aberdeen, Newton, Sarasin and Threadneedle
Charges: Annual £375-£475
Allocation rates: 100%
Commission: Subject to negotiation
Tel: 0845 1299993
Investment options 8.7
Company's reputation 7.3
Past performance 5.3
Product literature 8.7
Laurence Halter, Partner, Compton Financial Services, Barry Greening, Proprietor, Greenridge Life Pensions and Mortgage Consultants, Bob Leonard, Director, Advisory & Brokerage Services
Winterthur Life's universal Self-invested personal pension (Sipp) is a full Sipp which also offers access to the funds of 17 external fund management groups in addition to Winterthur's funds.
First, the panel assess how the Sipp fits into the market. Halter thinks it fits in well. Leonard says: "The pre-packaging of investment managers is likely to appeal to smaller IFAs that do not have in-house investment skills or direct access to stockbrokers." Greening says: "It is an extension of the Personal Pensions Management Limited (PPML) service. It has packaged a variety of services like portfolio management under one roof, together with property purchase and buying and selling shares."
Commenting on the type of client for whom this product is suitable, Greening says: "High-net-worth individuals with substantial funds held within personal pensions." Leonard says: "Clients who want something more flexible than a pure insured arrangement, who have more than £100,000 available." Halter disagrees with the fund size, he suggests clients with £50,000 or more to invest.
Looking at the marketing opportunities this Sipp will provide, Leonard says: "This product will appeal to clients looking for more involvement with their pension." Greening says: "As more clients are looking at flexibility and investment control over their pensions, this packaged and sophisticated contract will ideally fit their needs. We will consider aggressively marketing it to clients who have accumulated £100,000 or more in their funds."
Highlighting the main useful features and strong points of this Sipp, Greening says: "An experienced administration company in PPML, the panel of investment managers if required, discounts on charges for investment into Winterthur Life funds and lower charges than going directly to PPML." Halter agrees on the charges and adds: "There is no additional charge for drawdown and phased retirement. Also there is a good choice of outside fund managers and a low minimum contribution." Leonard says: "It is a very well thought through proposition aimed at all IFAs rather than specialist advisers, who are more likely to have their own in-house Sipp. The range of facilities online will help familiarise IFAs with the concept of Sipps."
Next the panel analyse the range of investment options. Halter thinks it is good. Leonard says: "The extensive range of Winterthur funds through fund of fund offerings, specialist trusts and investment management companies should be capable of satisfying most clients." Greening says: "Excellent. Winterthur Life has an enviable track record with all main investment houses and property purchase charges appear cheap relative to the competition."
Assessing the plans drawbacks, Leonard says: "The main disadvantage would be dealing via an insurance company for settlement if not using one the pre-selected options." Greening says: "There is no in-house facility for clients to borrow money for property purchase. Both Axa and Pointon York have this capability." Halter can find no disadvantages.
Turing to the flexibility offered, Halter finds it to be fair. Leonard says: "It is a good attempt by an insurance company to produce a flexible pension plan. Greening says: "Sipps by their very nature are the most flexible contracts. Winterthur Life has brought together experienced administrators in PPML and portfolio managers and given discounts on charges using its extensive range of funds."
Considering Winterthur Life's reputation, Halter and Greening are positive. Greening says: "Winterthur Life's reputation for investment performance is very good and so is PPML's for administration." Leonard disagrees. He says: "Winterthur Life is still weighed down by PPML's previous administration problems encountered by many IFAs involved in Sipps in the early days."
Turning to Winterthur Life's past performance record, Leonard says: "As Winterthur Life's proposition is mainly based on external fund managers, its own past performance record is immaterial." Greening says it is excellent, but Halter thinks it depends when you invested.
The panel next discuss the Sipps that provide the main competition to this product. Greening names the products from Pointon York, Tilney, Scottish Equitable, Skandia Life, GE Life (formerly National Mutual) and Axa. Leonard says: "Winterthur Life has established itself in a niche between fully insured and non-insured offerings. It seems flexible enough to compete in both segments of the market, although I expect the natural competition to be from insured arrangements."
Looking at how fair and reasonable the charges are, Leonard says: "Despite producing a sales aid with the first bullet point 'Are you fed up with complex charging structures?' Winterthur then goes on to detail numerous mix and match charging options. There are further investment manager charges to be taken into account dependent on the investment choice." Greening says: "There are discounts for instructing one of the panel of portfolio managers and there are also reductions for investing £100,000 into Winterthur Life funds." Halter also thinks the charges are fair.
Commenting on the commission, Halter and Greening reckon it is very flexible and fair. Leonard says: "This is to be agreed between the IFA and his client, with Winterthur Life offering flexibility over the structure of remuneration."
The panel express positive thoughts on the product literature. Leonard says: "The product literature is adequate, but is supported by very extensive software support." Greening says: "Good quality, clear and concise. The service standards statement is particularly good."
Finally, Leonard says: "I would have thought most clients with smaller funds would be better served using Winterthur Life's personal pension plan, offering access to the tailored selection and at a lower cost."