We have made several enhancements to the Collective Investment Bond (CIB) to give your clients more flexibility and give you greater control.
- Improved access to bond information.
- Manage assigned assets separately, giving you more control.
- Run a combination of model portfolios, loose assets or discretionary portfolios within the same bond.
- Instruct and amend withdrawals online, payable from the 1st to the 28th of the month.
The CIB retains its original features, including a structure of 1,000 life assurance policies, with the additional option to add capital protected death benefit at outset.
What can you invest in?
- The CIB provides access to a wide range of over 2,100 OEICs and unit trusts.
- Unlike our other products, exchange traded instruments are not available for this product.
- Whilst transactional cash will be used to fund fees and charges, it will not be possible to select cash as an investible asset within the bond. Other cash funds, for example Blackrock Cash, will continue to be available.
Improved assignment functionality
If individual segments within a bond are assigned after migration , you will now have the additional benefit of being able to manage the investment strategy of the assigned policies separately in their own sub account and you will also be able to charge fees specific to the sub account, giving you more control.
Following migration, all existing bond holders will be given a new account number for administrative purposes, plus a ‘Bond ID’. This means when a policy is assigned, the assigned segments will be given their own sub account number, but will retain the overall Bond ID to ensure a common reference for all associated bonds.
Bonds that existed prior to migration, where segments have previously been assigned, will not be separated into different sub accounts and all segments from the original bond will need to be managed as one.
New online withdrawals
It will now be possible to instruct and manage withdrawals online, without any need for signed paper forms, saving you time.
- You can withdraw up to a maximum of £50,000 online.
- The CIB must be held in the customer’s sole name, not jointly held or in the name of a company or trust.
- The proceeds must be paid into a verified bank account.
One-off withdrawals can be made via the following options
- By surrendering one or more of the individual policies (sometimes called segments) that make up the bond and therefore selling all the funds in those life policies.
- By withdrawing a specific amount from the bond, by selling units from specific funds (including model portfolios).
- By withdrawing a specific amount from the bond, by selling units proportionally from all funds.
- The maximum one-off withdrawal is 95% of the bond value (and 95% of any individual asset within it), unless all policies are being surrendered. Previously, the maximum was 90% of the bond value.
Information on how regular withdrawals can be funded and the full flexibility available can be found on our flexible withdrawals hub page.
Better access to the information you need
A new feature of the CIB is the introduction of the bond details screen, giving you better access to the information you need, without you having to spend time calling us.
The new screen will show you the following
- the current number of live policies on the bond
- the amount invested in the bond
- total withdrawals
- whether there has been a previous chargeable event since the migration to our new technology platform
- If an assignment has taken place, this will show the date the assignment took place.
You may also see a data item confirming whether we are calculating chargeable events manually or not. Where this is set to 'yes', we are manually checking our system calculations prior to certificates being issued to ensure accuracy. This ‘yes’ marker also suppresses the tax deferred allowance value on this screen. This ensures we do not provide you with an incorrect value whilst we are validating the data.
The way the Old Mutual Wealth Product Charge, Capital Protected Death Benefit Charge and Adviser ongoing servicing fee are calculated and deducted is changing.
- The Product Charge, Capital Protected Death Benefit Charge and Adviser ongoing servicing fee will now be calculated and accrued daily based on the value each day. The total of the accrued daily charges is deducted monthly on the charge date.
- If the client closes the account, any accrued charges which have not yet been taken will be deducted from the closure proceeds. The accrued charges will be shown on valuation statements.
Phased investment continues to be available for the bond. It allows lump sum contributions to be made into Blackrock Cash, and can be automatically switched into a chosen fund, funds or model portfolio, each month over a selected period. This provides a greater range of options to customers and advisers for managing their investments held with Old Mutual Wealth.
- The default cash option for the CIB is BlackRock Cash and phased into the selected assets over a period of 3, 6 or 12 months.
Trusts and the CIB
We continue to offer a wide range of trusts that can be used with the bond. To find out the steps you need to follow to successfully submit a bond application, see our easy to follow guide, which also includes details on how you can set a bond up under an existing trust.