The bond can be used alongside a range of trusts for estate planning and provides access to 11 internal funds managed by Eagle Star Investments, around 1,500 externally managed funds, a range of fixed-term deposit accounts and an option to appoint a discretionary asset manager.
The company has negotiated discounts and rebates on the charges from external fund management groups, but it may be possible to invest with other managers.
The bond is provided on a factory gate pricing basis, which means that no commission is built in. Instead, advisers and their clients will agree commission within Zurich’s menu. Initial commission can be paid through an initial charge or an establishment charge taken over five years, while renewal commission is paid through an annual charge.
A special enhancement feature allows investors to increase the value of their initial payment and any additional payments by up to 3 per cent. This is paid for by a 0.24 per cent establishment charge over five years for every 1 per cent enhancement. However, it is not available where initial commission is funded through an initial charge.
The standard death benefit is is available to people aged under 70 at the start of the plan and applies for the first 10 years. It pays the higher of 100.1 per cent of the plan value, 110 per cent of the plan value if death is due to an accident or the initial payment plus any additional payments minus any withdrawals.
Some people may already have life insurance so Zurich has provided the option to reduce death benefit to a flat rate of 100.1 per cent of the plan value in return for a 0.5 per cent reduction in the annual plan charge. However, this feature is not open to people aged over 70 when the plan starts. They get reduced death benefit but no reduction in charges.