Norwich Union special offer on drawdown

Article date: 8 March 2004

Norwich Union is introducing a new special offer on its TrusteeInvestment Product (TIP) product used for Income Drawdown. From 6April any pre or post retirement product investing in a new TIPwill benefit from the changes outlined below.

The main features of this offer are the removal of the planmanagement charge along with the early encashment charges so thatthe only charge remaining is the annual management charge of just0.625%*. There will be 100% allocation rate and no loyalty bonus.Overall, this makes the product simpler and a much more flexibleproposition for IFAs and increases value for clients.

Norwich Union forecasts that the Income Drawdown market will bea growth area as a result of Pensions Simplification.

Simon Warsop, head of retirement product development at NorwichUnion, said: "The feedback we have had from IFAs is that simplicityand flexibility are the key factors for both IFAs and theirclients. This special offer addresses both of those needs andcombined with the Norwich Union brand and our financial strength,we believe that we have developed a very strong proposition."

Quotes will be available from 8 March for IFAs wishing topre-sell to their clients.

-ends-

Press office contacts:
James Evans 08703 66 68 78 Out of hours 07790 487105
Louise Goffee 08703 66 68 70 Out of hours 07810 057362
David Gwyer 08703 66 68 71 Out of hours 07800 699508
Lorna Wiltshire 08703 66 68 78 Out of hours 07788 471849

Notes to Editors

* SIPP fees may apply – please ask for details

  • A Trustee Investment Plan (TIP) is available through theNorwich Union Self Invested Personal Pension (SIPP) for thosewishing to invest in insurance company managed funds. The NorwichUnion TIP is also available to those investing in othercompany’s SIPPs or members of SSASs. Within the TIP theclient can choose to save pre-retirement monies or utilise the TIPto do income drawdown, phased retirement or phased incomedrawdown.
Summary of
changes
Current planSpecial offer
Early encashment charges

Year 1 – 7.5%

Year 2 – 6%

Year 3 – 4.5%

Year 4 – 3%

Year 5 – 1.5%

Year 1

Year 2

Year 3 Nil

Year 4

Year 5

Plan management charge0.75% for 5 yearsNil
Loyalty units0.25% from year 11 onwardsNil
CommissionInitial 4% plus uplift FBC up to 0.5% pa (explicitlycharged)Initial 4% plus uplift less 3% FBC up to 0.5% pa (explicitlycharged)
Allocation101%100%

Key timings and transitional arrangements

Illustrations/Quotes

  • New business illustrations will be available from Monday 8March 2004.

    Re-quotes on the "old" terms would only be accepted between 8March 2004 – 7 May 2004 where a copy of the original quoteor the full quote number (with all the alpha & numerics) wasprovided dated in 2004.

Applications

  • Applications for new terms will be accepted from 6 April 2004.We will allow three months from 8 May 2004 (cut off 8 August 2004)for applications to be received requiring the "old" terms whichmust be accompanied by a copy of the full quote illustrating theterms required.

    Any application received from 6 April.2004 onwards without thecopy of a quote will attract the "new" terms.

    The offer may be withdrawn or varied at any time at NorwichUnion's discretion

  • Norwich Union is the UK’s largest insurer. It is aleading provider of life, pensions and investment products and oneof the leading IFA providers. IFAs provide around 70% of thecompany’s long-term savings business.
  • Norwich Union has strategic alliances with building societiesand other leading UK brand names including Tesco PersonalFinance and The Royal Bank of Scotland Group.
  • Norwich Union’s news releases and a selection of imagesare available from Aviva's internet press centre at www.aviva.com/media.

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