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Zurich increases bonus rates for 66,000 with-profits customers

Zurich has increased bonus rates for 85 per cent of its 78,000 with-profit customers.

The annual bonus rate has “typically” increased by 0.5 per cent for two-thirds of its unitised with-profit plans, it says.

In addition, the insurer says all final bonus rates have risen in its with-profits unitised plans. The annual bonus rate for conventional with-profits mortgage endowments has also increased –  from 0.25 per cent to 0.5 per cent – and the final bonus rate has increased to 155 per cent, up from 114 per cent.

However, annual bonus rates in the unitised series 2 tranche of Zurich’s with-profits fund will not change, remaining at a guaranteed 4 per cent for pensions and 3 per cent for life plans.

Likewise, bonus rates in conventional pension plans are unmoved, at nil.

Zurich head of in force and operations Jim Sykes says: “We are delighted that we are able to increase both the annual and final bonus rates for a large proportion of our with-profits customers.

“Those customers whose bonus rates are not increasing have contracts with valuable guarantees. We will be writing to all UK with-profits policyholders in March to inform them of the new bonus rates.”

Zurich says there no market value reductions in place on either fund.

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