Scottish Widows says an improvement in the performance of its with-profits funds means the life insurer has cut MVRs and will continue to pay bonus rates of 1% and 1.5% on its unitised flexible investment bond and pension policies.
A statement issued yesterday by >Scottish Widows suggest final bonuses, effect January 1, 2005, on the Flexible Options Bond will be 5% on the Flexible Options growth bond while the income version will pay 3.5-4.5% on the back of yields ranging between 5.75% and 10.75% per annum.
Elsewhere, the market value reduction (MVR) rate applied to policies being withdrawn from the with-profits fund has now fallen to an average MVR of 5% on unitised with-profits pension policies and unitised with-profits assurance policies – compared with an average of 10% at the end of 2003 - thanks to a partial recovery of the stock market.
Conventional with-profits life and pension policies (only those affected after 1999) will continue to receive payouts of just 0.5% basic guaranteed plus 0.5% of existing bonus CWP pension policies prior to 1999 will still receive nothing.Payouts on international investment bonds will continue at the same rate as announced for July 1, 2004.IFAonline
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