Standard Life will add about £800m of bonuses to with-profits plans this year.
The move follows increases in plan values over the past year, despite volatile equity markets.
For example, a £10,000 investment in a with-profits bond on 1 February 2003 would have grown in value from £14,099 on 1 February 2007 to a cash-in value today of £15,833.
Bonus rates on unitised with-profits will rise 0.5% to 2.5% a year for with-profits bonds and 0.5% to 2% for other life plans exempt from a 3% unit price growth guarantee.
Rates for unitised with-profits pension plans will rise 0.5% to 2.5% a year except where a 4% unit price growth guarantee applies.
However, annual bonuses on conventional with-profits plans will be held at the same rates as last year.
Jim Black, actuarial director, Standard Life, says: “2007 has been a difficult year for financial markets, particularly over the second half as the global credit crisis began to take hold.
“However, with-profits customers are also benefiting from continued distributions from the Inherited Estate in the form of enhanced payouts for those plans which are eligible. Consequently, all types of with-profits plans have benefited from positive returns during 2007.”
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