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Administration details
Type of policy
The Total Access Bond is a unit-linked whole of life, non-qualifying life assurance policy issued by Canada Life Limited.
Life assured
The Bond can be written on either a single life, joint life (first or second death). There can be a maximum of 4 lives assured. Minimum age for lives assured is 3 months attained. There is no maximum.
Policyholder age limits
Minimum age at entry is 18 attained. There is no maximum age.
Minimum/maximum investments
The minimum premium is £15,000. Additional amounts may be added to the Bond at any time, subject to a minimum of £2,500. Premiums of up to £1 million will normally be accepted. Amounts greater than this are subject to individual consideration.
Clustering
For added flexibility, the Bond can be divided into a maximum of 999 clusters of separate identical policies of at least £1,000 each. This may help with your client’s tax planning on encashment.
Allocation rate
The allocation rate is fixed at 100%.
Loyalty bonus
There is a loyalty bonus of 0.5% of the fund value of each bond at the end of its fifth year and every 5 years thereafter.
Charging structure
Establishment fee plus annual management charge plus investment management fees. See ’Charges’ and ’Commission Rates’ below.
Top ups
The Bond allows for top ups to be added to the existing Bond subject to a minimum premium of £2,500. We will use the total investment amount, including the top up to determine the establishment charge to be used.
Funds
The funds available are series 3 life funds.
Funds per policy
Up to 10 funds can be chosen for each premium paid. If top ups are subsequently made these may be applied to another set of different funds if required, again up to a maximum of 10.
Switches
We currently offer unlimited free fund switching. Any switch request will be effected on the next valuation date after receipt of request.
Phased investment
• Phased investment is free of charge and is used to automatically move money gradually from one group of funds to another over a defined period of time.
• Three options are available;
• Full option; move 100% of your nominated funds,
• Partial option; move a specific percentage of your nominated funds, or,
• Fixed amount option; move a specific monetary amount of your nominated funds.
• Frequency of phased investment can be monthly or every three months (quarterly).
• Timescale can be over a 6, 12, 24 or 36 month period.
• Once started, the frequency, timescale and funds chosen cannot be changed; to make any changes the existing phased investment must be cancelled and a new one must be requested.
• Up to nine nominated funds to switch out of and up to nine selected funds to switch into can be chosen, but the combined number of funds must not be more than 10.
Certain events will cause the phased investment service to automatically be stopped. Please see the policy provisions for details of these events.
Withdrawals/Surrenders
- Regular withdrawals
• There are no charges for regular withdrawals.
• After each withdrawal the remaining total Bond value must be the higher of £250 or twice the value of any outstanding establishment charges.
• Regular withdrawals can be taken yearly, half yearly, quarterly, monthly and termly (ideal for school fees planning). The minimum regular withdrawal is £250 per annum. The maximum regular withdrawal is 10% p.a. of the premium.
• Regular withdrawals can either be apportioned across all funds equally or targeted at up to 5 specific funds. Where withdrawals have been elected from a particular fund they will cease once the units of that fund have been exhausted.
• The amount, frequency and start date of regular withdrawals can be specified subject to the limits mentioned above.
- Partial surrenders
• There is no maximum partial surrender amount but the remaining total Bond value must be the higher of £250 or twice the value of any outstanding establishment charges.
• There are no charges for partial surrenders.
• Partial surrender requests can be apportioned across all funds equally or targeted at up to 5 specific funds.
• The minimum partial surrender is £250.
• For partial surrenders to be paid a request for payment form or letter signed by the current policyholders must be submitted. If the Bond is in trust then all trustees must sign.
- Full surrender
• The investment can be surrendered in full at any time without a charge.
Death benefit
• The amount payable is 100.1% of the value of the units at the next valuation date following notification of the death to us. This applies to all ages
• If this occurs within three years of the initial investment or a top-up there will be a claim back of initial commission.
Commission
- Initial commission
Initial commission can be varied between 0% and 5% in increments of 0.1% and 0.25%.
In the event of surrender or death within the first 3 years of the contract, a percentage of initial commission is returned to us. This also applies to the first three years following any top-ups where initial commission is taken.
Years
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Initial commission claimed back
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Year 1 (First 6 months)
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100%
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Year 1 (Last 6 months)
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85%
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Year 2
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75%
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Year 3
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35%
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Trail commission
In addition to any initial commission you may also select a fund based trail commission from 0% to 1% p.a. paid for by unit deduction in increments of 0.25%. Trail commission can be stopped, started and varied at any time subject to client approval. Commission will be paid after the first month. This can be paid either monthly or weekly in arrears by BACS.
Reduction in yield
We offer a range of low cost funds that allow you to change your commission whilst still keeping a 1% reduction in yield. Please ask for more information.
Charges
- Initial charge
There is no initial charge.
Annual management charge
The Total Access Bond has an effective annual management charge of 0.40% p.a and is linked to Canada Life’s series 3 life funds. Series 3 life funds have an AMC of 1% per year that is deducted by cancellation of units. The effect of the AMC is reduced by a rebate of 0.60% that is credited to the plan each month (on a monthly anniversary).
- Investment management charge
In addition to the annual management charge which is specific to the Bond there is an annual management charge which is levied on the fund(s). Charges vary depending on the fund chosen. We calculate this charge as a daily rate and it is reflected in the unit price. For further details please see Life Funds – Risks and Charges (8318) available in the funds section of the library. All management charges are subject to regular review by Canada Life.
- Establishment charge
The basic establishment charge is the sum of:
• The initial commission selected plus age and/or premium adjustment plus 1%.
• Based on initial commission of 5% and for premiums of £50,000 or more the standard rate for an 80 year old client is 6% of initial premium paid over five years.
• The establishment charge is payable over the first five years following the date of payment and will be deducted, via deduction of units, monthly in advance.
New business requirements
Please ensure that the following items are completed before submitting to Canada Life:
• Application form
• Cheque
• Personal example, which advises the funds, commission basis and if clusters have been selected
• Trust form, if applicable
• Money Laundering Certificate(s) and certified copies of evidence.
Money laundering certificates are required for all policyholders, trustees, attorneys and cheque payees. If lives assured are minors then evidence is required to prove their existence: original birth certificate or certified copy of their passport or verification certificate.
Please note that past performance is not a guide for the future. The value of units can fall as well as rise and currency fluctuations may also affect performance.
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