AIG Life launches Sipp product backed by protected equity index funds By Kira Nickerson AIG Life is ...
AIG Life launches Sipp product backed by protected equity index funds
By Kira Nickerson
AIG Life is guaranteeing that investors in its Stakeholder Friendly Personal Pension bond (PPB) can transfer to any other providers' stakeholder product at the full value of the fund.
Starting on 4 August the bond will offer full transferability and a minimum transfer value.
The investment must be made in the group's guaranteed funds but can be in any investment market the group offers, including US, Japan, Pacific Rim, Europe, UK or Managed fund. The PPB is a single premium product, which offers an allocation rate of 100% and has a 1% annual management charge. There are no penalties on transfer at lock-in dates and there is no bid/offer spread, policy or plan fees. There are loyalty bonuses after 10 years and every five years thereafter.
In April the PIA stated that advisers must consider whether a personal pension investor is materially disadvantaged in any subsequent transfer to stakeholder pension.
At the same time the group has launched a single contribution Sipp product which requires a minimum investment of £20,000 into insured AIG stock market funds, which can be accessed through the PPB. Sums in addition to this can be invested in a range of assets including equities, gilts, unit trusts, Oeics and property.
These self-invested assets may be under the control of an investment manager on a discretionary or advisory basis or they can be self-managed.
The Sipp is available in two structures, one aimed at long-term capital appreciation and the second at those entering income drawdown in the near to medium future.
For long-term investors the product offers allocation rates of up to 120% and a loyalty bonus in later years. For income drawdown clients the Sipp has a 100% allocation irrespective of term or premium.
The plan has no bid/offer spread or charges other than the annual management charge of 1.1%. Initial commission can be paid as a direct charge from the policy at a level between 0% and 7%. Fund based service commission has been introduced allowing intermediaries to decide the type and level of remuneration. It can be taken at a level between 0% and 1%pa of the fund in steps of 0.05%.
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