With-profits bonus announcement

Due to significant falls in equity markets since August, along with current volatility in the markets, Standard Life has today announced an immediate reduction in final bonuses.

Market Value Reductions (MVRs) which already apply in some cases will now be increased and extended to more with-profits plans.

Margaret Flaherty, With-Profits Communications Manager, Standard Life Assurance Limited, said: "Investment returns have generally been poor over the last year, but particularly so since August, resulting in today's decision to reduce final bonuses and extend MVRs.

The changes that we have made today will ensure that we maintain fairness between planholders who choose to leave with-profits, and those who remain invested until their plan maturity or retirement date.

"As a result, most with-profits customers will see a fall in the value of their plan.

Despite today's changes, with profits plans are still providing some protection against market volatility for customers approaching maturity and retirement.

"Standard Life remains committed to with-profits and continues to believe that with-profits can be an appropriate investment as part of a balanced portfolio.

Sample with-profits payouts: A 20-year savings endowment plan taken out on 29 October 1988 by a man aged 29 for ?;50 per month would have grown in value from ?19,764 on 1 November 2007 to a maturity value today of ?20,693.

A 20-year individual pension plan taken out on 29 October 1988 by a man retiring at age 65 for ?200 per month would have grown in value from ?83,874 on 1 November 2007 to a retirement value today of ?88,655.

A with profits bond based on an investment of ?10,000 on 29 October 2003 would have reduced in value from ?13,947 on 29 October 2007 to a cash-in value today of ?12,060.

Past performance is not a reliable guide to future performance.

Back to top