Mortgage Products
Legacy
Disclaimer
Pension Products
Contact
Protection Products
Investment Products
General
PRUDENTIAL INVESTMENT PLAN
These are the standard product details and do not include any changes in special offer periods.
Initial commission
Initial commission can be selected (subject to a maximum limit of 8%, unless a special deal is allowed). Two methods for funding Initial Commission are available for each individual investment:
Initial Charge or Establishment Charge but not a combination of both.
Trail commission can also be selected either independently or combined with Initial Commission, subject to a maximum Equivalent Initial Commission limit of 8% - refer Trail Commission section below for further details.
For top ups the commission option selected can be independent to that selected at initial investment and/or other top ups.
Initial Charge - where selected the level of initial charge is deducted from the investment amount through a reduction in the allocation rate. For example 5% initial commission by way of initial charge on a £100k investment results in only £95k being invested (reduction in the standard Allocation rate of 5%, from 100% to 95%).
Establishment Charge - where selected the initial investment is not affected (allocation rate 100%) but a charge will apply for 5 years and be taken monthly as a part of the Annual Management Charge Adjustment. For example a 5% initial commission creates a 1% p.a. Establishment Charge for the first 5 years of each investment.
If the Establishment Charge Option is selected for an investment, an Early Cash-In Charge will apply if all or part of the plan is cashed-in within 5 years of the investment.
Early Cash-In Charge - The Early Cash-In Charge percentage applicable is based on the level of Initial commission selected and will vary from plan to plan & potentially from each top-up made. A charge is applied to unit cancellation in first 5 years calculated from the date of each investment (initial or top-up).
For example:
Early Cash-In Charges applicable where the initial commission rate was 7% and funded via the Establishment Charge commission option a 7% rate reduces by 1.4% (1/5th of 7%) at the end of each whole year in force.
i.e. Early Cash-In Charge:
| During Year: | % of value of units |
| 1 | 7% |
| 2 | 5.6% |
| 3 | 4.2% |
| 4 | 2.8% |
| 5 | 1.4% |
| 6 | 0% |
'Trail (Renewal) commission'
'Trail Commission' if selected, is payable monthly & based on the total "Assets under Management" (subject to a maximum limit of 8% Equivalent Initial Commission*. This is calculated on a 1:5 basis i.e. 1% Trail Commission = 5% Initial Commission). A combination of initial commission & trail commission can be chosen subject to the 8% Equivalent Initial Commission overall maximum limit.
Where Trail Commission has been selected the level of trail commission chosen is funded through an addition to the Annual Management Charge on a 1 for 1 basis. Example 0.5%p.a. trail commission will generate a 'Trail Commission AMC' addition of 0.5% p.a. , taken on a monthly basis as part of the Annual Management Charge Adjustment.
Commission give up is not available, though commission levels are determined and agreed between Customer and Adviser.
* Equivalent Initial Commission
There is a maximum Equivalent Initial Commission (EIC) of 8%
Trail Commission should be converted on a 1:5 basis to get the Equivalent Initial Commission.
For example
1% Initial Commission = 1% EIC
1% Trail Commission = 5% EIC
A combination of Initial and Trail Commission is allowable up to a combined maximum EIC of 8%.
