Product Profile of the Month
December 2009
Product Provider - Royal Skandia Life Assurance Limited
Product Name - Executive Investment Bond, authorised in Hong Kong
Single or Regular Premium - Single
Target Audience - Individual investors, Corporate investors and Trustees
Jurisdiction - Isle of Man
Website link - www.royalskandia.com
Product Description:
The Executive Investment Bond is a flexible lump sum whole-life investment. It is an open architecture offering with a high level of investment freedom and a wide range of charging options. It offers the convenience of holding all assets in one portfolio. It also provides a great opportunity to achieve capital growth whilst minimising the amount of administration.
Benefits
- Extensive choice of investment assets.
- Ability to transfer in existing fund holdings into the policy or on top of new cash investments.
- Track all investments through one statement. Paperwork and record keeping made easy.
- On-line service enables your client to check their investment portfolio and download policy valuation statements whenever they need.
- Pass back any negotiated initial institutional discounts to your client based on our global purchasing power.
- Competitive choice of charges.
- Invest and denominate the policy in one of a range of the world’s major currencies.
- Option to delegate fund management responsibilities by appointing a fund adviser.
- Option to select a custodian by using the selected custodian facility.
- Easy access to capital – total or part surrender at any time with the option to take regular withdrawals to provide an ‘income’. An early encashment charge may apply if the bond is encashed in the early years.
- Death benefit of 101% of the surrender value of the policy at no extra cost.
Risks
- If your client cashes in the bond early, or take withdrawals that exceed the growth, they may get less back than they paid in.
- The value of fund units can go down as well as up and investment growth cannot be guaranteed.
- If your client invests in a fund that holds investments in another currency, there may be additional risks because of exchange rate fluctuations.
Tax-efficient growth
Whichever investment funds you select, growth can be achieved tax-efficiently. As Royal Skandia is based on the Isle of Man, it is not currently liable to any form of tax in respect of the income and gains on policyholder funds. This means that, with the exception of certain investment income that may be subject to a tax deduction in its country of origin, the Executive Investment Bond will grow tax-free. Policyholders may be liable to taxation on any gains made on the Account.
Policyholder protection and peace of mind
Of all the major offshore centres, the Isle of Man is one of only a few which has a statutory compensation scheme for life assurance companies.
Who is eligible?
The minimum and maximum age limits for investment are 18 and 89 respectively. The Executive Investment Bond is designed predominantly for international investors.
Minimum premiums
- Minimum initial premium: £50,000 / $75,000 / €75,000 (or currency equivalent).
- Minimum additional premium: £5,000 / $7,500 / or €7,500 (or currency equivalent).
- Premiums are accepted in most major currencies.
For further information please contact your Independent Financial Adviser.
Alternatively, visit Royal Skandia’s website – www.royalskandia.com. For Hong Kong investors, visit Royal Skandia’s Hong Kong website – www.skandiainternational.com/hk
