Equitable Life with profits pension / takeover.

pensionpawn wrote: »

My statement says 'investments in Equitable with profits' is x (split protected and non-protected rights) and my transfer value is 90.8% of x. It also says that 'value of guaranteed benefits' is 96.6% of x. It also states that 'the Equitable with profits transfer value includes an amount (23.5% of x) which represents the share of capital that has been allocated to your benefit and is payable when the benefits is taken. This amount is not guaranteed and can go down as well as up'.

I consider myself reasonably competent with finances and pensions however Equitable Life statements baffle me. I have no idea what value the uplift will be applied to!

This seems different from my simpler policy statement.
My wording says what the transfer value means - and how it applies - but doesn't ever quote a reduced number for it - just a simple with profits policy value and a unit linked value.
Mines does split protected rights and personal contributions - but this is now potentially less important - as I have been told by 2 other private pension companies they now allow you to lift protected rights benefits at 55 etc.
You can now ignore the guarantee number - it's gone.

My policy value - your x I guess - simply includes the standard 35% capital distribution - but this is in reality only approx 26% of x ( 74% of x is my base policy value (x/1.35) - 26% of x is capital distribution, calculated from base / as 35% of base (35% of 74% = 26% of x etc)).
My personal illustration uses a figure very close - within few £100s - to this 74% of x base - and then applies the uplift - in my case primary plus secondary to the base policy value.


So if my X was 100K, my base was 74K, my old 35% distribution would have been 26K, but the uplifted figure - say if took just a 70% uplift as mid-range primary - would by 1.7*74K base = 126K.

I can shed no light on why your X is reduced by the 9.2% to get the transfer value - but it strikes me this could simply have been applied across the board to my simpler figures - which is why your distribution is only 23.5% of X - as this is also is approximately 0.908*26.

Perhaps others here have such an adjustment applied - and can shed more light on it.

By analagy to my 74% - you could look at your base for uplift being transfer value - distribution - 90.8-23.5 = 67.3% ( which is again 0.908*74) - but not sure if this is fair. As you are strictly not transferring out of the AVC scheme - why shouldn't your full underlying value remain under the control of your group / AVC administrator - i.e. the full X or rather to be more accurate now the scheme is approved - the uplifted 74% of X etc. - even if they then ask for the same 9% if you transfer away.

If the admins haven't been in touch - I suspect they might even have been or at least might be thinking of making the initial investment choices - but may equally just be in the secure cash for now. Most group schemes I have been in have had restricted choice or at least a default investment option chosen by the scheme. Suspect only time will tell - but seems poor service not to keep you informed at all.

I suspect you just need to keep nagging them - they may have been avoiding making decisions - until the scheme was approved - and are now going to need to quickly catch up to reality.



You might be lucky and get the new value from Utmost ( old EL staff ) - but worried they will bounce you back to the AVC / group managers.

Utmost are meant to be sending value and investment choice statements to new members this month - but I worry this will only be individual members - as could well have to go via Group admins for people in your position.

None of us actually know yet what the final primary percentage or changes for the recalculated secondary would be - but hoping I will know by the end of this month.

Given problems both you and Joey Soap etc are having getting any answers out of AVC / group pension administrators not sure how this will be resolved quickly.

My partner is in the process of using her Equitable WithProfits fund to buy an annuity. She's just received a letter giving Utmost's transfer value - it is a factor of 1.058578 higher than the figure for "Potential unit-linked value" quoted in the Equitable's Illustration document last year.

I don't know what the actual uplift has been - the base level figure (for end-December 2019) to which the uplift percentage is applied may have changed from the figure used in the Illustration. But I thought that using the difference between her Illustration value and the new transfer value might give others a guide: multiply your Illustration value by the factor to give your new value at Utmost.

Phoned Utmost to see whether could use pre switch date investment pack fund choice forms - told no. And was confirmed I was now in the secure cash fund for first 6 months then auto age default if I do nothing in the interim.

Re my post above about funds - was also told that the Utmost website still needs updating and any new cash transfers out of secure cash would go to the JPM managed unit funds. Was also told that any old Aberdeen funds may well be migrated to new JPM mamagement funds at some point - but she didn't have a hard date. Would probably check this again before move any funds though - seemed a bit vague.

Apparently now can just phone and ask for funds to be moved - and will be done effectively based on next business day if I think she said before 5. To phase investments will have to repeat process. EL used to do this / or accept by email etc. However Utmost website says they would still need to receive a paper transfer form - I guess as confirmation to keep a hard record of signed instructions - but this was not mentioned on phone.

Re Uplift Values
Utmost will now tell you your current fund values if you ring the Aylesbury office.
Operator I spoke to said no idea of actual numbers as of 1st Jan transfer to work out exact percantages - and didn't appear to know the primary value / secondary value split etc - but as of today - my total secure cash fund was approx 9.5 % higher than personal illustration figure.

A very nice bonus on top of illustration uplift.

I suspect my figure is higher than pafpcg - as I had a decent secondary - in the teens - at time of illustration - and the IE supplementary report suggested the overall secondary could also be higher. Without knowing the actual primary figure - difficult to know for sure though.

Letters will be sent "end of month" - exact date ? - to confirm actual uplift values applied to fund values as of 31st Dec / 1st Jan transfer.