Investment Bond With Death Guarantee Key ... - Legal & General

investment BOND with death guaranteeKEYFEATURESOF THEinvestmentBOND withdeathguarantee.For additional investments into existing contracts onlyThis is an important document.Please keep it safe for future reference.

Investment BOND with death guarantee – KEY FEATURES2ABOUT US.The Legal & General Group, established in 1836, is one of the UK’s leadingfinancial services companies. As at 30 June 2013, we were responsible forinvesting £440 billion worldwide on behalf of investors, policyholders andshareholders. We also had over 7.3 million customers in the UK for ourlife assurance, pensions, investments and general insurance plans.WHAT ARE KEY FEATURES?The Financial Conduct Authority is afinancial services regulator. It requires us,Legal & General, to give you this importantinformation to help you to decide ifmaking an additional investment into yourInvestment Bond is right for you. You shouldread this document carefully so that youunderstand what you are buying, and thenkeep it safe for future reference.using this documentWe’ve tried to use plain language to keepthe Key Features easy to understand. You’llfind explanations of any technical termswe use in the glossary on page 13 of thisdocument. Whenever terms covered in theglossary appear in the main text, we’vehighlighted them in blue.other documentsYou should read this document alongsidethe following other documents youradviser will give to you:• Your Illustration.• The Funds key features, which explainsthe basics of investing in funds and theimportant things you need to knowabout them.You can also ask your adviser for thePolicy Provisions, which contains theterms and conditions that apply to youradditional investment. We’ll send thisto you once your additional investmenthas started.FINDING OUT MOREThis icon appears when more detailedinformation is available elsewhere.If you’d like to see any of the otherdocuments we mention before makingyour additional investment, please askus or your adviser.

Investment BOND with death guarantee – KEY FEATURES3Key features ofTHE investmentBond with deathguarantee.for additional investments into existingcontracts onlyITS AIMSRISKS• To grow your investment over five yearsand more.• To give you the option of taking an income.• To provide a guaranteed minimum payment onthe death of a named person, known as the lifeassured (or if more than one person, the deathof the last life assured).YOUR INVESTMENT• You make an additional investment of atleast £5,000.• There’s no fixed term but you should considerthis as a medium to long-term investment, beprepared to invest for at least five years, andideally not tie yourself to a particular end date.• If you cash in all or part of your additionalinvestment, the amount you receive may bereduced by an early surrender charge.General• The value of your additional investment can fallas well as rise, so you could get back less than youinvest.• You might get back less than is shown in yourIllustration if:––the funds you invest in grow at a lower rate,––the charges are higher,––you move your investment into other funds withhigher charges, or––you take more money out.• If you choose to cancel your additional investmentin the first 30 days, you may get back less thanyou invested.FUND RISKS• There are specific risks relating to the funds you caninvest in. Those applying to your chosen fund areset out in the accompanying Funds key features.The Money Advice Service provides free and independent information about investments. You can find out moreabout investment risk at: www.moneyadviceservice.org.uk/en/categories/planning-your-investments

Investment BOND with death guarantee – KEY FEATURES5WHAT ALLOCATION RATE WILL YOU APPLYTO MY ADDITIONAL INVESTMENT?• Your allocation rate is the percentage of your additional investmentwe use to buy units. The percentage depends on a number of thingsincluding:––the amount of your additional investment,––the total amount you have previously invested in your bond, minusany amounts you have cashed in,––the age of the youngest life assured, and––whether your adviser gives you advice about making youradditional investment into your bond.• The charges for your bond were originally created based on payingcommission to the adviser firm that arranged investments into thebond for any advice they gave you. Due to a change in regulationswe’re no longer able to pay commission if you’re given advice aboutmaking an additional investment into your bond.• If your adviser does give you advice, we won’t pay them anycommission. To take account of this, and to avoid making complexchanges to your bond, we’ll increase your allocation rate so theamount you invest will buy more units. Charges will remain as shownin the What are the charges? section. You’ll need to agree how to payyour adviser for their services separately.• If your adviser doesn’t give you advice about making an additionalinvestment, we’ll pay commission to your adviser on the same termsas your most recent investment into your bond.NOTEs• We’ll show any increasedallocation rate in yourIllustration.

Investment BOND with death guarantee – KEY FEATURES6What flexibility is there afterI invest?• You can:––keep your additional investment for as long as you like,––cash in all or part of it at any time,––switch your money between funds,––use the additional investment to provide you with an income, withthe flexibility to alter it if your needs change,––add further additional investments in the future.• You can add to your bond in the future provided our investment termsat that time allow it.• The terms that apply to each additional investment may be differenteach time you make an additional investment. We’ll give you a newPolicy Provisions with details of the terms at that time.• There’s currently a maximum of five additions over the term ofyour bond.NOTES• Some funds have higher chargesthan others, so if you switchto another fund, you may becharged more.• We currently do not make anycharge for the first 12 switchesin any 12 month period but anyadditional switches are chargedat £25 each.For more details of the flexibility of your additional investment, limitsand charges please see the Policy Provisions.What might I get back?• Your accompanying Illustration gives you a guide to what you mightget back and shows the effect of charges.• The amount you actually get back when you cash in your additionalinvestment will depend on:––the performance of the assets in the fund that you and your adviserhave selected,––how much money you’ve taken out previously,––the charges paid on your bond.See the section headed What are the charges? on page 8 for moreinformation about charges.• If you choose to take an income, the amount you receive could go upor down and will affect the amount remaining invested.NOTES• There may be an early surrendercharge. If this is applicable it’sshown in your Illustration. Seethe Early surrender chargesection on page 8 for moreinformation.• Remember that unless thegrowth of any investment meetsor exceeds the rate of inflation,its real value will reduce.

Investment BOND with death guarantee – KEY FEATURES7How can I take money out?• You have three options. You can:––cash in part of your investment,––cash in all of your investment,–take – an income in a variety of ways, which may be tax efficient.• If any individual policies are cashed in, the Guaranteed Death Benefitwill be reduced. The new Guaranteed Death Benefit will be the totalof the amounts invested into the remaining policies, that is your initialinvestment reduced proportionately in respect of any policies cashed in.For more details on how you can take money from your bond, the optionsavailable and conditions that apply, please see the Policy Provisions.What happens if I die?• It depends on whose name you set your bond up in.–If – your bond is set up in your name only, it ends.––If you set up your bond in the name of more than one person,it ends on the death of the last life assured to die.• When your bond ends we pay the greater of:––101% of the full value of your units, or––the Guaranteed Death Benefit shown in your Illustration, or if anypolicies have been cashed in, the reduced amount as described inthe How can I take money out? section above.NOTES• No early surrender chargeapplies on death.

Investment BOND with death guarantee – KEY FEATURES8What are the charges?• Charges are made to cover the various costs involved in setting upand managing your additional investment such as:––the day to day management of your chosen fund,–administration,–––the costs of buying and selling assets,––payment to your adviser.Annual management charge• The annual management charge is taken into account whencalculating the unit price of each fund so you’ll not see a specificdeduction from your additional investment for this charge.• Additional expenses are incurred when managing a fund. Theadditional expenses are taken into account in your Illustration.INITIAL CHARGE• There’s an initial charge if the allocation rate shown on the first pageof your Illustration is less than 100%.ESTABLISHMENT CHARGE• This is 0.5% of your additional investment’s value each year for thefirst five years.EARLY SURRENDER CHARGE• Your Illustration shows the amount, the length of time it will apply forand effect of this charge, in the What will the charges be? section. It’sreferred to as a ‘Reduction in cash value’.• This charge doesn’t apply to any regular amounts you take from youradditional investment to provide you with an income.NOTES• Annual management chargesand additional expenses arereviewed regularly and canchange at any time.• We’ll tell you what the currentannual management charge isfor the fund you’re invested in atleast once a year.For more details about any of the above charges and how theymay apply to your additional investment please see your Illustrationand the Policy Provisions.

Investment BOND with death guarantee – KEY FEATURES9What about tax?• The funds are subject to tax on investment income received and oncapital gains. We pay this tax and you cannot reclaim it.• When you take money from your additional investment it’s free ofpersonal income tax at the basic rate. It’s also free of capital gains tax.• You may have to pay some income tax if:––you take money from your additional investment above certainlimits or you cash in any of your additional investment whilstyou’re a higher or additional rate tax payer,––you become a higher or additional rate tax payer due to the moneyyou receive from your additional investment.• If you die, the people who inherit your bond may have to pay someincome tax. They may also have to pay some inheritance tax, althoughyou can help to reduce this amount or avoid it completely by puttingyour bond into a trust. Your adviser will be able to help you do this ifit’s appropriate for you.• If you’re eligible for any age allowance, working tax credit or child taxcredit, your allowance may be reduced if you take money out. Thiscould increase your tax bill.NOTEs• This tax information is givenbased on our understanding ofcurrent tax law relating to lifeassurance contracts. Tax lawmay change in the future.It’s possible to take money from your bond in a tax-efficient way. Howmuch tax you pay on the money you take out of your bond depends onyour individual circumstances. Your adviser will be able to provide youwith advice on the best way to take money out.Before you take money from your additional investment or talk to youradviser about it, we suggest you read the Policy Provisions for moredetails of the tax treatment of your bond.

Investment BOND with death guarantee – KEY FEATURES10Can I change my mind?• After you invest, we’ll send you a cancellation form. If you changeyour mind about making your additional investment, complete theform and send it to the address in the How can I contact you? sectionbelow, within 30 days of receiving it.• After 30 days you can’t cancel your additional investment but youcan cash it in. Please note that an early surrender charge may applyas explained on page 8 and your money is subject to the risks asdescribed in the Risks section on page 3.NOTES• You will not get back more thanyour additional investment.• If there’s been a fall in theinvestment value of youradditional investment, yourrefund will reflect this.How do I find out how my ADDITIONALinvestment is doing?• The value of your additional investment will be included in the valueof your bond.• We’ll send you a statement with the value of your bond at least oncea year.• You can ask for a valuation or additional statements from us at any time.• To work out the value of your bond simply multiply the number ofunits you hold in each fund by the unit price. Please note this may notbe the cash in value if an early surrender charge applies, as explainedin the What are the charges? section on page 8.You can check the value of your bond yourself by looking up the unitprice for each fund at www.legalandgeneral.com or call us on thenumber shown below.How can I contact you?Your adviser will normally be able to help you with any questions youhave about your additional investment that are not answered in theseKey Features or the Policy Provisions.If you’d like to ask us anything, please do. You can contact us using anyof the following:Call us on 03700 500 263Calls to this number will not exceed your fixed line or mobile phoneprovider’s national rate and will be included in any inclusive free minuteplan or discount scheme you may have with your telephone provider.Call charges will vary between telephone providers. We may record andmonitor calls.Email our helpdesk at: pbhelp@legalandgeneral.comIf you’re contacting us by email please remember not to send anypersonal, financial or banking information because your informationisn’t secure.Write to us at:Legal & General, City Park, The Droveway, Hove, BN3 7PY

Investment BOND with death guarantee – KEY FEATURES11OTHERINFORMATION.Law and languageCompensation schemeThe contract you enter into with us is governed byEnglish Law. All customer communications are onlyavailable in English. All communications from us willnormally be by letter or telephone.Our regulatorWe’re covered by the Financial Services CompensationScheme (‘the scheme’). You may be entitled tocompensation from the scheme if we can’t meet ourfinancial obligations. This depends on the type ofbusiness and the circumstances of the claim.Currently 90% of the value of the valid claim is coveredby the scheme. There is no upper financial limit onthe claim.Legal & General Assurance Society Limited isauthorised by the Prudential Regulation Authority andregulated by the Financial Conduct Authority and thePrudential Regulation Authority. We’re entered on theFinancial Services Register under number 117659. Youcan check this atwww.fca.org.uk/firms/systems-reporting/registeror you can call 0800 111 6768.You can get more information about the schemeat www.fscs.org.ukUK RESIDENCYThe bond is designed for policyholders who are UKresidents. You should speak to your adviser to confirmif the bond is still suitable for you if you:• are currently a non-UK resident or become a non-UKresident after you invest, or• are subject to tax in another country or becomesubject to tax in another country after you invest.

Investment BOND with death guarantee – KEY FEATURES13glossary.This is an explanation of some common terms used in these Key Features.Additional investment A further lump sum investment into your existing bond.Allocation rateAssetsBondFund or funds(also known as‘unit-linked fund’)IllustrationIncomeLife assuredPoliciesPolicyholderTrustUnitsUnit price or pricesWorking dayThe percentage of your money that’s used to buy units.The investments that make up a fund. For example, shares or cash.Our Investment Bond with Death Guarantee is a lump sum life assurance contract used forinvestment purposes.A collection of assets that the bond can be invested in. Where we refer to ‘fund’ in thisdocument it can mean fund or funds.A document that forms part of these Key Features that provides a guide to howmuch you might get back from your investment. It’s based on a number of exampleinvestment growth rates and reflects the charges you may pay over the time you’reinvested. It assumes that charges will remain at their current level and your fundselection and any income remain unaltered throughout the term of your bond.Where income is used in this document we’re referring to regular payments madefrom your bond that are used to provide you with an income.The person, or persons, on whose life your bond depends as described in thePolicy Provisions.A series of identical insurance contracts. Each policy has its own unique numberand can be individually recognised. As a group, the policies make up the bond.The legal owner, or owners, of your bond.A legal arrangement that allows investments or property to be held for the benefitof someone else without giving them full control of it.A unit is a share of a fund. Each fund is split into a series of units. The number of unitsyou hold is your share of the fund.A price calculated each working day that is used to value units.Any day from Monday to Friday inclusive, excluding English public holidays.

Investment BOND with death guarantee – KEY FEATURES14www.legalandgeneral.comLegal & General Assurance Society LimitedRegistered in England and Wales No. 00166055Registered office: One Coleman Street, London EC2R 5AAAuthorised by the Prudential Regulation Authority and regulated by theFinancial Conduct Authority and the Prudential Regulation Authority.A member of the Association of British Insurers.W13769 12/13 Approved: 12/13 Approval number: H0145157