Norwich Union with-profits policy holders saw their investment returns fall more than 50% in 2007, according to the provider.
Investments in the CGNU and CULAC with-profit funds fell 5.4% before tax down from 11.9% in 2006 and 17.7% in 2005 as a result of increased market volatility.
However, UK equities remained the most popular asset class in 2007, despite the fund reducing its exposure from 43.2% in 2006. International shares come second at 17.8%, up from 9.8% in 2006, followed by property at 18.4% compared to 21% in 2006.
David Barral, marketing director at Norwich Union, says: “The past year has been a rough ride in the markets for investors but it has been one that again has demonstrated the value of with-profits investments and should give confidence to customers.”
In better news for investors, Norwich Union also announced bonuses totalling £1.5bn were added during 2007 for around 2.4m CGNU with-profits customers and many final bonus rates increased.
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An added tier of asset management can of course deliver additional benefits for certain investors, writes Graham Bentley - just be sure you can justify it to the regulator and, especially, the client