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United Friendly life insurance with profits policy
Vonna555
Posts: 1 Newbie
My father took out a United Friendly life insurance with profits policy (United Friendly inIndustrial Branch Fund (UFIB) Fund) the 1970's. It was transferred to Royal London in 2001. They wrote to my father recently stating that the pot is getting smaller and that they have been increasing his policy value by adding an extra amount when his policy is claimed, because they do not know how much the estate will be.
Royal London are proposing to share out the estate sooner which would increase the current value of the policy. The Royal London Open Fund will hold back enough money to protect the policy against future risks to meet the rules set by the regulator. In exchange for this an amount will be taken from the estate and paid into the Royal London Open Fund. Policy holders will have to give up some of the estate to gain " more certainty over the payout". Royal London are asking for policy holders thoughts.
Reading between the lines, I believe that this policy was a type of pyramid structure as as soon as they closed the fund to new business the pot became a lot less. Are Royal London trying to put in place a new fund in case policy holders state they were miss sold the existing policy?
Royal London are proposing to share out the estate sooner which would increase the current value of the policy. The Royal London Open Fund will hold back enough money to protect the policy against future risks to meet the rules set by the regulator. In exchange for this an amount will be taken from the estate and paid into the Royal London Open Fund. Policy holders will have to give up some of the estate to gain " more certainty over the payout". Royal London are asking for policy holders thoughts.
Reading between the lines, I believe that this policy was a type of pyramid structure as as soon as they closed the fund to new business the pot became a lot less. Are Royal London trying to put in place a new fund in case policy holders state they were miss sold the existing policy?
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Reading between the lines, I believe that this policy was a type of pyramid structure as as soon as they closed the fund to new business the pot became a lot less. Are Royal London trying to put in place a new fund in case policy holders state they were miss sold the existing policy?
No.
I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.1 -
No. What they are saying appears quite reasonable.
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