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Smoothed Return Announcement

In 2023, our globally diversified With-Profits Fund produced a positive return in changeable, and fast moving, economic conditions. Our Income Choice Annuity customers have also benefitted from the application of smoothing to provide a more stable return from year-to-year.

We’re also delighted to have additional money in our With-Profits Sub-Fund to share with our Income Choice Annuity customers at this bonus declaration which increases the unsmoothed value of their plans by 1.25%. The amount being shared is £1bn. The additional money shared, is reflected in our Smoothed Returns from this year. You shouldn’t expect to get additional money in the future. There’s also a chance we might have to take back the additional money distributed this year (or in previous years) in future but, unless something very unusual happened, we wouldn’t expect to have to do this. You can find out more on our website at: pru.co.uk/aboutadditionalmoney.

In 2024, the team will continue to take decisions that allow them to manage the Fund prudently. We’ll aim to secure the highest total return for the Fund (after any tax and expenses) while maintaining an acceptable level of risk and protecting our customers.

We aim to ensure those with an annuity get their fair share of the With-Profits Fund's investment returns via the announced Smoothed Return. In addition to the investment returns on the Fund, the Smoothed Returns we announce depend on several factors including:

  • the effective date of the annuity

  • how we expect investments to perform in the following months

  • our views on mortality

  • adjustments for smoothing

  • your Plan's charges.

The announced Smoothed Return can be changed and isn't guaranteed until it's due to be paid on your clients next Plan anniversary. It could even be negative, for example, if stock markets perform badly. The effect of the Smoothed Return we announce on your clients income is included in their yearly statement. This webpage explains the 2024 Smoothed Return Announcement for the Income Choice Annuity.

See the bonus declaration for the With-Profits fund.

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

How does this affect the Income Choice Annuity product?

  Effective Date (Annuity Start Date) 
Announced Smoothed Return Year  09/03/09
to 05/04/09
06/04/09
to 05/04/10
06/04/10
to 05/04/11
06/04/11
to 05/04/12
06/04/12
to 05/04/13
06/04/13
to 05/04/14
06/04/14
to 05/04/15
06/04/15
to 05/04/16
06/04/16
to 05/04/17
06/04/17
to 05/04/18
06/04/18
to 05/04/19
06/04/19
to 05/04/20
06/04/20
to 05/04/21
06/04/21
to 05/04/22
06/04/22
to 05/04/23
06/04/23
to 05/04/24
2024 6.5% 6.0% 6.0% 6.5% 6.0% 6.0% 5.0% 5.5% 6.0% 6.0%* 5.5%* 6.0%* 6.0%* 6.0%* 6.0%* 6.0%*
2023 2.0% 2.0% 2.0% 2.0% 2.0% 1.0% 1.0% 1.0% 1.0% 1.0%* 1.0%* 1.0%* 1.0%* 1.0%* 4.5%*  
2022 19.0% 19.0% 15.0% 15.0% 14.5% 14.5% 14.5% 14.0% 14.0% 10.0%* 10.0%* 10.0%* 10.0%* 9.0%*    
2021 5.0% 4.0% 2.5% 2.5% 2.5% 2.5% 2.0% 2.0% 2.0% 0.5%* 0.5%* 0.5%* 4.5%*      
2020 17.5% 15.5% 13.0% 13.0% 13.0% 13.0% 13.0% 12.5% 12.5% 6.5%* 6.5%* 4.5%*        
2019 2.5% 1.0% 1.0% 1.0% 1.5% 1.5% 1.5% 1.0% 1.0% 1.0%* 4.5%*          
2018 12.0% 11.0% 11.0% 11.0% 11.0% 11.0% 9.5% 8.0% 8.0% 6.0%*            
2017 10.0% 9.0% 8.0% 8.0% 8.0% 8.0% 7.0% 6.0% 6.0%              
2016 5.0% 5.0% 4.0% 4.0% 3.5% 3.0% 2.5% 5.0%                
2015 8.5% 8.5% 7.0% 7.0% 6.5% 6.0% 5.0%                  
2014 8.0% 7.5% 6.5% 6.5% 6.5% 6.0%                    
2013 6.0% 5.0% 4.5% 4.5% 6.0%                      
2012 7.0% 6.5% 4.5% 6.0%                        
2011 9.0% 7.1% 6.5%                          
2010 8.5% 7.1%                            
2009 7.1%                              

*This applies to customers originating from our Flexible Lifetime Annuity (FLA) only.

Source: Prudential

Past performance isn’t a reliable indicator of future performance. Changes in the income payable from an Income Choice Annuity will depend on the relationship between the Smoothed Return announced and the Required Smoothed Return needed to maintain the customer’s chosen income. The income from an Income Choice Annuity can fall as well as rise at each plan anniversary, subject to any guaranteed minimum level of income (known as the Secure Level) that applies. The Smoothed Return can be changed and it’s not guaranteed until it becomes payable at the next plan anniversary.

Related Content

PruAdviser – With Profits bonus rate

We have a summary of the 2024 annual bonus rates and with-profits declaration that you can share with your clients. Find out more here.

Regular and Annual Bonuses

See the With-Profits fund announced Smoothed Returns for our Income Choice Annuity product.