For UK financial advisers only. Not approved for use by customers. Visit the Prudential customer website For UK financial advisers only. Not approved for use by customers. Visit the Prudential customer website

With-Profits Bonus Declaration

Over 2017, The Prudential Assurance Company Limited With-Profits Fund returned 9.1% (net of tax) and 10.3% (gross of tax), both before charges and the effects of smoothing*. Please see information specific to your Plan to find out more.

*This describes the main asset pool in our With-Profits Sub-Fund, which is relevant to the vast majority of our customers.

Please remember that past performance is not a reliable indicator of future performance.

On the Bonus Declaration literature page, you'll find literature and sales aids that you can use to discuss bonus declaration with your clients.

Summary of 2018 annual bonus rates

  Annual bonus rate
Most* Unitised (or accumulating With-Profits) With-Profits bonds 1.50%
Flexible Retirement Plan (including income drawdown) and Trustee Investment Plan (for all new business post 7/11/11) 1.05%
Corporate pensions (unitised) 1.75%
With-Profits Pension Annuity 0.25%
Most^ Unitised (or accumulating With-Profits) Personal Pensions 1.50%

*Most refers to Prudence Bond (Optimum Return) both no initial charge and initial charge versions, International Prudence Bond & Prudential International Investment Bond (Euro), International Prudence Bond & Prudential International Investment Bond (US) and PSA/PIB (Fund over £6000).

^Most refers to all Capsil and OPAL personal pensions. It also applies to Prudential Series A and Premier Plans (including TIP Series A for business sold between 01/01/2003 and 06/11/2011) written on or after 01/01/2003.

2017 was another successful year for our With-Profits Fund on the back of positive returns in many investment markets.

We aim to provide fair pay-outs based on what the Fund has achieved. This year we’re pleased to maintain annual bonus rates, which will continue to add to the guaranteed benefits of our customers’ plans, while being able to increase final bonus rates for most customers. So the vast majority of our customers will benefit from increases in the value of their plans.

The performance of the Fund in 2017 demonstrates the benefits of remaining invested in a globally diversified fund. In 2018, we’ll continue to manage the Fund in a prudent manner, aiming to secure the highest total return for the Fund over the long-term (after any tax and investment expenses) while maintaining an acceptable level of risk and protecting our planholders.

Read more about With-Profits Bonus Declaration February 2018

Fund size and rating

The Prudential Assurance Company Limited With-Profits Fund is the largest and one of the financially strongest with-profits funds in the UK. The size and strength of our Fund allows us to invest in a very wide range of assets and individual companies.

The total level of assets backing the With-Profits business in the Fund was £103bn at 31 December 2017.

The Prudential Assurance Company Limited is rated AA for financial strength by Standard & Poor's, as at January 2018. This is one of the highest ratings currently given to any UK Life Assurance Company.

Fund Management

Prudential Portfolio Management Group are our in-house asset-allocation experts in the UK. They select a wide range of assets to hold in the With-Profits Fund, in line with the Fund's objective. The aim is to maximise long-term investment returns while maintaining the financial security of the Fund. 

PAC With-Profits Fund - comparative cumulative and annualised returns over 1, 5 and 10 years

  1 Year return % 5 Years cumulative return % 10 Years cumulative return % 5 Years annualised return % 10 Years annualised return %
Prudential With-Profits Fund (net)* 9.1 47.0 76.5 8.0 5.8
Prudential With-Profits Fund (gross)** 10.3 56.4 89.6 9.3 6.6
ABI UK - Mixed Investment 20% - 60% Shares Sector Average - Life Funds*** 5.6 30.3 51.3 5.4 4.2
ABI UK - Mixed Investment 20% - 60% Shares Sector Average - Pension Funds*** 6.2 36.0 66.1 6.3 5.2
FTSE 100 Total Return 11.9 57.2 73.8 9.5 5.7
Morningstar 90 Days Notice (UK Savings £25,000+) Net 0.3 2.0 6.5 0.4 0.6
Morningstar 90 Days Notice (UK Savings £25,000+) Gross 0.4 2.4 8.1 0.5 0.8
UK Retail Price Index 4.1 12.7 31.9 2.4 2.8

Source: Prudential, FE. All figures to 31 December 2017 
* With-Profits performance is net of tax and before charges and the effects of smoothing. The returns shown are for the main asset pool in our With-Profits Sub-Fund, which is relevant to the vast majority of our customers.
** With-Profits performance is gross of tax and before charges and the effects of smoothing. The returns shown are for the main asset pool in our With-Profits Sub-Fund, which is relevant to the vast majority of our customers.
*** ABI UK – Mixed Investment 20-60% Shares – The Association of British Insurers (ABI) has a classification system whereby the performance of funds that have similar asset allocations are grouped together to give an average performance figure. This is known as the sector average. It's important to note that some if not all of the Funds comprising this sector average will already have fund management charges deducted from their performance.

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© Prudential 2018