MetLife has launched an Investment Bond with a Secure Capital Option designed to ensure investors always receive back at least the amount invested with the opportunity to lock-in gains.
The Investment Bond is a flexible single premium, unit-linked whole of life insurance bond investing in a range of Best of Breed and Managed Portfolio funds. These funds will be chosen with the assistance of research company Morningstar Associates.
Minimum investments in the bond, which is available exclusively through IFAs and whole of market advisers, are £20,000 and minimum additional payments into the bond are £1,500. Additional payments can be made at any time and clients can also switch without charge between funds.
The Investment Bond offers high levels of flexibility for withdrawals and as the bond has a life insurance element it also offers death benefits.
Research conducted by MetLife among IFAs shows 57% say demand for flexible retirement income products has significantly increased and the Investment Bond is designed to meet this demand.
MetLife in Europe’s chief operating officer Paul Shallis says: “The Secure Capital Option allows clients and their advisers to invest money secure in the knowledge that the value is guaranteed at the end of 10 years regardless of what has happened in the stock market.”
Clients opting for the Secure Capital Option invest in a range of Secure Capital Portfolios: Defensive Managed, Conservative Managed, Cautious Managed and Balanced Managed. The investment split reflects the risk appetite of investors with equity investment ranging from 35% to 85%.
Investors will have a Secure Capital Value Review after five and seven-and-a-half years. This will increase the Secure Capital Value to the value of the investment in the Secure Capital Portfolio if it exceeds the existing Secure Capital Value. If it is lower the Secure Account Value is unchanged.
The MetLife Investment Bond offers two flexible charging structures, allowing clients to opt for growth or income.
Maximum Allocation starts at 100.5% and rises to 102.5% depending on the amount invested. Fully Accessible option allocation rates start at 95.5% and rise to 97.5%.
There is a 1% annual establishment charge for the first five years under Maximum Application but not under Fully Accessible. The annual management charge is 1.10% and the guarantee charges range between 0.7% and 2.35%. There is a loyalty bonus of 1.25% after 5 years and a further 1.25% after 10 years.
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