What is the Unitised with Profits fund?
Premiums are used to buy units in the fund. Annual bonuses are declared each year and this is added as a percentage to the unit price thereby increasing the value of the fund. We may apply a final (terminal) bonus at the end of a policy, which is declared as a percentage of the units bought in each year of the policy, each year potentially having a different bonus rate. The key difference between unitised with profit and other unit linked funds is that we guarantee that the price of a unitised with profit unit will never fall. The Unitised With-Profits fund is invested in a balanced portfolio of UK and overseas ordinary shares, fixed interest stocks, cash deposits and property. This type of fund rises steadily at a rate declared by our management. They can change the rate of the growth at any time. It cannot fall in value. A typical rate of increase would be about 8% per year. This would typically be changed every 6 months or every year.
