Pensions specialist to broaden its range into pure investment bond market
Winterthur Life is to enter the investment bond market later this year, selling product outside a pensions wrapper for the first time.
The fund selection within the bond will be based on the 40-strong third party fund links within its Tailored Selection range which it already offers via pension contracts. This contains offerings from more than 20 fund management houses and includes access to Jupiter Income, Invesco Perpetual High Income, Gartmore European Select Opportunities, Credit Suisse Income and Fidelity Special Situations.
The Tailored Selection is priced for fee-based advisers, with no bid-offer spread on funds or enhanced allocation, but the group is looking to put initial and renewal commission options on the investment bond.
Angela Baskeyfield, product development manager at Winterthur, said the group plans to replicate the clean charging structure on the Tailored Selection but is also considering the option of up to 107% allocation. Intermediaries taking this option would be able to take initial and renewal commission but Winterthur could then add in exit penalties.
Bernard Henshall, investment development manager at Winterthur, said the investment bond would not replicate the contents of the Tailored Selection range exactly. Some of these are pooled pension funds and as such cannot be put into an investment bond he added.
Winterthur has pencilled in a November launch for the product and is looking to make it accessible via the internet. Baskeyfield said fund fact sheets and performance stats would be available via the internet and investors would be able to switch funds online. The group is not opposed to selling the bond itself online but only once it feels confident electronic signatures are fully secure.
Winterthur's 30 business development managers, who sell the group's pension products, will be charged with distributing the bond. The group already runs more than £1bn in third party links via pensions. Funds are picked by an investment committee of five, backed up by two full-time research analysts.
There is also an Elite Managed Funds Service for intermediaries who want to outsource picking investments from the Tailored Selection range to Winterthur.
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