NPI is to launch a socially responsible with-profits fund in October, which will be made available t...
NPI is to launch a socially responsible with-profits fund in October, which will be made available through a range of bonds the group is bringing out at the same time, writes Kira Nickerson.
The group plans to offer its complete range of funds within a number of bond structures but will pre-package fund combinations to target certain sections of the market.
At launch there will be three packages available.
The NPI investment bond, which has four elements: a with-profit fund with a headline rate of 8.5%, an ethical with-profit fund with the same rate, unit linked funds and ethical linked funds, which include the group's Global Care and Global Care Managed.
The with-profit bond will offer a combination of the with-profit fund and the new ethical with-profit.
The ethical bond will use the investment combination of the ethical with-profits and the group's ethical unit linked funds.
All three bonds will feature no initial charges, policy fees or loyalty bonuses and will offer a headline rate of up to 8.5%.
The allocation rates to the bonds are determined by the total contribution to the underlying investment. For amounts between £5,000 and £14,999 the allocation rate on with-profits and unit linked funds is 100%.
For amounts between £15,000 and £19,999, the rate for with-profits is 102% and for unit linked it is 100.25%. The minimum premium is £10,000 for new policies and £1,000 for increments, however, the group has said it would consider investments below £10,000 on a case by case basis.
Standard commission terms are available at 5.25% initial or 3% initial plus 1.5% fund based renewal. Partial and full commission surrender are permitted with a 1% increase in allocation rates for each 1% of commission given up.
The interim reversionary bonus for the with-profits fund and the ethical with-profits will be 5% for 2000 and 2001.
No switching is allowed out of the with-profit funds within five years of investment, although switching is allowed into any of the available funds regardless of how the bond was originally structured. The first four switches in any policy year are free, subsequent switches are charged at £15.
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