This section is only relevant to our with profits policyholders. For most with profits funds and products we may add two types of bonus.  These are an annual bonus which we may add to your policy each year.  And a final bonus which we may add when you make a claim on your policy, such as when it matures.  For other products we may add only annual bonuses or bonuses in the form of declared returns or rates of interest.  Our bonus rates vary according to with profits fund and by product.  This section provides a generalised summary about bonuses.  For specific information about your type of policy, see your latest annual bonus statement and supporting information.  Also, see the guide to how we manage the with profits fund (the 'guide') relating to your policy, which we have previously sent you.

Each year, we may add an annual bonus to your policy.  If we do add a bonus, the amount that we guarantee to pay, when your policy matures, or on earlier death, will increase by the amount of bonus.

Any yearly statements that we send you will include information about the annual bonus added to your policy.

When deciding whether we should add an annual bonus, we look at the current financial position of the with profits fund and estimate how we expect this to change in the future.  We also compare the guaranteed benefits with the underlying value of policies.  We will add annual bonuses only if we are confident that the underlying value of policies will be enough to enable us to pay these bonuses at maturity, even if future investment returns or other factors become unfavourable.  We may not be adding annual bonuses for some with profits funds and products.

The underlying value of policies reflects the premiums paid and the investment performance of the with profits fund over the lifetime of the policies, after allowing for factors, such as expenses and charges.  This is explained in more detail in the guide.

We may also pay a final bonus when your policy matures or on earlier death.  We will review final bonuses at least once a year, but we may change them at any time.  We will tell you the amount of final bonus we have added to your benefits when we make a payment.  We may not currently be adding final bonuses for some with profits funds and products.

When deciding the final bonus rates, we compare the underlying values of specimen maturing policies with the value of their guaranteed benefits.  If the underlying value of the policies is more than the value of their guaranteed benefits, we will add a final bonus.  However, if the value of the guaranteed benefits is more than the underlying value of the policies, we will not add a final bonus.  The amounts of final bonus are affected by 'smoothing' as described below.

We aim to avoid very large differences in with profits maturity payouts over relatively short periods of time. We consider the maturity payments that we have made to similar policies in the past and limit, where possible, the changes in final bonus to avoid very big differences in payouts from one review to the next.  We call this practice smoothing.  Smoothing means that we may pay more or less than the underlying value of policies.

You can find more information on bonuses and how we decide what bonuses to pay to different types of policy in the different with profits funds in the guides we have produced explaining how we manage the with profits funds.  Click here for the guides.

If you’ve any questions you can contact us by following this link.

This section is only relevant to our with profits policyholders. For most with profits funds and products we may add two types of bonus.  These are an annual bonus which we may add to your policy each year.  And a final bonus which we may add when you make a claim on your policy, such as when it matures.  For other products we may add only annual bonuses or bonuses in the form of declared returns or rates of interest.  Our bonus rates vary according to with profits fund and by product.  This section provides a generalised summary about bonuses.  For specific information about your type of policy, see your latest annual bonus statement and supporting information.  Also, see the guide to how we manage the with profits fund (the 'guide') relating to your policy, which we have previously sent you.

Each year, we may add an annual bonus to your policy.  If we do add a bonus, the amount that we guarantee to pay, when your policy matures, or on earlier death, will increase by the amount of bonus.

Any yearly statements that we send you will include information about the annual bonus added to your policy.

When deciding whether we should add an annual bonus, we look at the current financial position of the with profits fund and estimate how we expect this to change in the future.  We also compare the guaranteed benefits with the underlying value of policies.  We will add annual bonuses only if we are confident that the underlying value of policies will be enough to enable us to pay these bonuses at maturity, even if future investment returns or other factors become unfavourable.  We may not be adding annual bonuses for some with profits funds and products.

The underlying value of policies reflects the premiums paid and the investment performance of the with profits fund over the lifetime of the policies, after allowing for factors, such as expenses and charges.  This is explained in more detail in the guide.

We may also pay a final bonus when your policy matures or on earlier death.  We will review final bonuses at least once a year, but we may change them at any time.  We will tell you the amount of final bonus we have added to your benefits when we make a payment.  We may not currently be adding final bonuses for some with profits funds and products.

When deciding the final bonus rates, we compare the underlying values of specimen maturing policies with the value of their guaranteed benefits.  If the underlying value of the policies is more than the value of their guaranteed benefits, we will add a final bonus.  However, if the value of the guaranteed benefits is more than the underlying value of the policies, we will not add a final bonus.  The amounts of final bonus are affected by 'smoothing' as described below.

We aim to avoid very large differences in with profits maturity payouts over relatively short periods of time. We consider the maturity payments that we have made to similar policies in the past and limit, where possible, the changes in final bonus to avoid very big differences in payouts from one review to the next.  We call this practice smoothing.  Smoothing means that we may pay more or less than the underlying value of policies.

You can find more information on bonuses and how we decide what bonuses to pay to different types of policy in the different with profits funds in the guides we have produced explaining how we manage the with profits funds.  Click here for the guides.

If you’ve any questions you can contact us by following this link.

We provide guaranteed annuity options in certain circumstances on some of our pension policies.

If you’ve any questions you can contact us by following this link.

We send policyholders who have mortgage endowment policies regular updates.  In this update we tell you whether your endowment is on track to re-pay the mortgage, or whether we anticipate that there may be a shortfall.  It is important to check each time how your policy is performing.

Investments will do better in some years than others, so the situation can change from one update to the next.

We can provide updates for policyholders on their policies at any time.  Please contact us if you would like an update.

Further information on mortgage endowments is available from the FSA website.

If you’ve any questions you can contact us by following this link.

Where we invest your money depends on the product you have and the fund(s) you have chosen.  Products may be either invested in unit linked funds or one of the with profits funds or both.

We have different investment mixes in our different with profits funds.  We may also vary the investment mix depending on the type of product and policy you have.

We invest the with profits funds in a mix of assets such as company shares (equities), property, bonds (types of loan usually issued by the Government or companies) and cash deposits.  Some of our with profits funds have no exposure to company shares or property.

Further details of our with profits investment approaches can be found in our Guides to how we manage the with profits fund.

If you’ve any questions you can contact us by following this link.