Source: https://www.equitable.co.uk/ProposalAug2019/index.html
Timestamp: 2019-11-13 15:42:56
Document Index: 138478921

Matched Legal Cases: ['arts 1', 'art 1', 'art 2', 'art 2', 'art 2', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 2', 'art 26', 'art 1', 'art 2']

I'd like to see content for
Policies invested in With-Profits
Policies not invested in With-Profits
A summary of the Proposal
It is important that all Members and Policyholders understand what the Proposal will mean for them.
This website will provide you with information about the Proposal, but for more detailed information, you should read the pack we sent to you in August 2019.
The Proposal outlines our plans for the future of the Equitable, and consists of two parts:
Part two – known as the Transfer:
To Transfer all of the business of the Equitable to Utmost Life and Pensions Limited, except for certain Excluded Policies such as German Policies and Irish Policies that will remain with the Equitable, which will become a subsidiary of Utmost.
Scheme Policyholders voted in favour of the Scheme at the Policyholders’ Meeting and Eligible Members voted for the Change to the Articles at the EGM.
The Equitable will now ask the High Court to approve the Scheme and the Transfer at the Second Court Hearing starting on 22 November 2019. We will publish confirmation of the outcome of this Hearing on our website.
If the High Court gives that approval, then we expect the Proposal to be implemented with effect from 1 January 2020. The Uplift will be applied to your with-profits policy as soon as practicable after 1 January and more details about this can be found in the Latest News and FAQs
If the Proposal is implemented, it will affect all Policyholders. Ownership will transfer to Utmost, and your Policy will be with them and not the Equitable. You cannot opt out and if the Scheme and Transfer are approved, your With-Profits Policy would be affected, even if you didn't vote or voted against the Proposal.
Have you made your investment choice yet?
Click here to read the information in the investment choice pack
Click here for information on where to go for help, including subsidised financial advice
Find out more about about Utmost including the funds available here
Latest News and FAQs
Expert Supplementary Reports and Updates issued
Minor technical changes to our Scheme
Questions and answers about our Proposal
Introduction to Utmost
Utmost Life and Pensions is a UK life and pensions company helping customers plan and save for the long term, with roots going back over 100 years. Utmost currently look after 100,000 customers, with £1.7 billion of assets and are part of the wider Utmost Group of Companies; a growing specialist life assurance group currently managing £33 billion of assets under administration and 240,000 customers.
Utmost purchase long-established businesses and books of business from major insurance groups and provide a safe home for their existing customers and policies.
Utmost are not looking to disrupt the service you're accustomed to, simply to reinforce and support it. They aim to continue providing reliable, consistent servicing and clear communications administered by the teams in Aylesbury.
Click here to find some FAQs about Utmost
You can find out more about Utmost Life and Pensions on their website at www.utmost.co.uk including a dedicated section for Equitable Life policyholders.
"We are looking forward to all Equitable policyholders joining us so we can secure your future together."
What you need to do if you haven't made an investment choice yet?
Understanding the documents sent to you
Your covering letter sets out how the Proposal affects you and provides an overview of the Scheme, the Change to the Articles and the Transfer and signposts what information in the pack is relevant to you. It confirms your status under the Proposal and whether you were able to vote on the Scheme and the Change to the Articles and also confirms what we asked you to consider, what will happen next and where you can find support and guidance.
Explanatory Booklets Part A & B
These booklets provide you with key information about the Proposal and how it would impact you and other Policyholders.
Part A highlights the personal considerations policyholders needed to think about, to help decide whether this Proposal is right for them.
Part B provides details of the Proposal and describes the impact on your policy. It covers the rationale for the Proposal, other options that have been considered and details of what support is available.
Your Personal Illustration shows how your Policy Value may increase, and what Investment Guarantee would be removed, together with a projection showing how this might look at a particular point in the future, if the Proposal is approved by the High Court. It also provides a comparable set of values should the Proposal not go ahead. If you would like to know the effect on your savings using a different basis, please contact us.
The following provides an explanation of the information contained in your illustration. The example is for a Pension Policy. If you have an illustration for a different type of policy and would like help to understand your illustration, please contact us on our helpline number 0330 159 1530 (+44 1296 385 225) if calling fron outside the UK)
The Voting Forms
Your pack included the Voting Forms relevant to you. Voting closed on 1 November 2019.
Investment choice pack
Investment Choice booklets Parts 1 & 2
These documents were issued to Scheme Policyholders in a separate mailing shortly after the Decision Pack
These booklets contain information from Utmost Life and Pensions about the investment options that would be available to you if the Proposal goes ahead.
Part 1 – Key information about your investment options
Information about the investment options which would be provided by Utmost Life and Pensions, according to your Policy type, including what happens if you do not make any investment choice. It also includes information about; what to consider before you make your investment choice, Unit-Linked Fund charges, and how to obtain further information or access subsidised financial advice.
Part 2 – Detailed information about funds
Information about the range of funds which would be made available by Utmost Life and Pensions including Self-Select Funds for Policyholders who wish to choose their own investment portfolio. It also includes more details about the risks related to each fund and general information about how Unit-Linked Funds work.
Investment Choice Form
When you are ready to make your investment choice, you should complete this form (one per policy) and return it to us.
Hargreaves Lansdown Leaflet
The Equitable is providing access to subsidised financial advice operated by Hargreaves Lansdown which is available to UK With-Profits Policyholders who live in the UK. This leaflet provides details about the costs of these services and how to access this advice. Find out more
Investment Choices with Utmost
Help with your investment choices
If you have an Irish policy, or an International policy with funds in US Dollars and would like information on the available funds, please contact us or look at page 12 of your Investment Choice Booklet recently sent to you.
Scheme Policyholders will have received an Investment Choice Pack, which includes information about the Unit-Linked Funds that are available from Utmost Life and Pensions.
It is important that you consider the information in this pack, regardless of whether you personally want the Transfer to Utmost to go ahead. This is because if the High Court approves the Scheme and Transfer, your Policy will transfer to Utmost even if you personally did not vote in favour.
Deciding on what funds to choose with Utmost may be a daunting task, especially if you are not familiar with investing, but the Investment Choice Pack aims to help you make your decisions.
You will have a variety of choices of what funds to invest in:
If you don't want to make investment decisions yourself, you can choose from three simple Multi-Asset funds, each with a different risk profile designed for cautious, moderately cautious, or growth-seeking investors.
Investing by Age (for Pension Policies only)
A strategy that gradually reduces risk over time, depending on your age and how close you are to taking your savings. Over time, your investments automatically transition from the Multi-Asset Moderate Fund to the Multi Asset Cautious Fund and eventually to the Money Market Fund.
If you consider yourself to be a more experienced investor, you can build your own portfolio by choosing from a range of specific assets such as shares, Bonds, and cash. You can choose to spread your money across more than one fund.
Automatic investment option
If you don’t want to make a specific choice of funds to invest in, you can choose the Automatic Investment Option for your investments with Utmost.
This is also the default option if you do not make a choice before the Transfer goes ahead.
Automatic Investment Options
The Automatic Investment Options have been chosen as the Equitable and Utmost believe that they are suitable for the needs of a large number of Policyholders. If you decide to choose one of these options, you still need to understand the risks and rewards of each:
Investing by Age (pension policies only)
Pension Policyholders can choose the ’Investing by Age’ strategy, which automatically moves your savings to lower risk funds as you become older, and potentially closer to retirement or in retirement, and therefore protecting you from significant falls in the value of your savings.
Multi-Asset Moderate (life policies only)
Your savings are invested in a diversified range of assets designed to deliver growth, with a moderate risk profile.
If you are comfortable making your own decisions about what funds you want to choose for your investments, you are able to select from a range of funds in which to invest.
The funds available to choose from, offer a range of different assets and markets, which you can select depending on your own attitude to risk, your personal circumstances and your plans for your savings.
There is no restriction on the number of funds you can invest in, and you also have the option of mixing self-select options with the Automatic Investment Options.
Whatever fund choices you make, you are able to change them at a later date should your plans change.
You can find out more by reading the Investment Choice Pack, Part 2, section 6 and by visiting the Utmost website.
There are four key fund types available to choose from if you want to self-select your funds:
These funds can invest across a wide range of Equity and bond markets (and other assets) providing investors with a high level of diversification in just one fund.
Combines investors’ money to invest across a wide range of company shares. They provide professionally managed exposure to the growth potential of stock markets.
Loans an investor makes, usually to governments and companies, which pay a regular income to the lender (the fund) over the term of the loan. The original loan is also expected to be repaid to the fund when the loan matures. Bond funds can invest in bonds issued by a range of different borrowers.
Money market/cash funds
Typically invest in securities with a very short maturity, usually issued by governments, financial institutions or large companies.
Section 2 in Part 2 of your Investment Choice Pack will help to explain how each type of fund could play a different role in your investment planning, depending on your attitude to risk or how long you want to invest for.
You can also find more information about the funds available at Utmost’s website
Help with your investment choice
Making a decision on where to invest your funds may be daunting, so we have arranged a choice of ways to get help:
A specialist company, JLT, are providing support free of charge on our helpline number 0330 159 1530 (+44 1296 385 225 if calling from outside the UK)
Subsidised advice is available to UK based individual clients through Hargreaves Lansdown. Advice is available from as little as £50 (after subsidy)
full financial advice
Find out more here or contact 0117 906 7800 for help.
A financial adviser can give you advice. We may make a contribution of up to a maximum of £355 towards the cost of this advice.
You can find out more about the help on offer in Part 1, section 6 of your Investment Choice Booklet.
You do not have to use any of these sources of help if you do not want to, however we would recommend you call the helpline on 0330 159 1530 (+44 1296 385 225 if calling from outside the UK) in the first instance to help consider whether you need financial advice before making this important decision.
Hargreaves Lansdown subsidised financial advice
The Equitable is providing access to subsidised financial advice operated by Hargreaves Lansdown to With-Profits Policyholders who live in the UK.
Hargreaves Lansdown Services available:
Online limited advice
An online service offering advice on how to reinvest your policy(s)into funds managed by Utmost Life and Pensions.
You’ll pay £50 for online advice about your Equitable policy; Equitable will pay £150.
Telephone limited advice
A telephone advice service that will provide bespoke advice on how to reinvest your policy(s) into funds managed by Utmost Life and Pensions.
You’ll pay £95 for telephone advice about your Equitable policy; Equitable will pay £355.
A Financial Adviser will provide advice on your Equitable policy and any other investments. This service is most appropriate for clients who need support in planning for major life events such as retirement.
You’ll pay 1% of the assets advised on for telephone advice on both your Equitable policy and any other investments. This is subject to a minimum charge to you of £345. The Equitable will contribute up to £450. For example – for advice on Assets of £100,000, the total advice charge would be £1,000. £450 would be paid by the Equitable, meaning the cost to you would be £550.
Find out more or dial 0117 906 7800 to speak to their help desk.
More details about the costs of these services and how to access this advice can also be found in the Hargreaves Lansdown leaflet enclosed in your Investment Choice Pack.
What to think about when making your investment choice
Everyone’s investment choice is based on their personal circumstances, such as what you want to do with your savings. Therefore the investment choices that you make should reflect this.
The Investment Choice Booklet, Part 1, section 2 provides more information about factors you may need to consider.
You should consider your attitude to risk. Different funds attract different levels of investment growth, but they also have different levels of risk associated with them. For example, cash investments have a lower level of investment growth than equity investments, but also have a lower level of risk of large drops in market values.
You can read more about the different funds and their levels of risk in the Investment Choice Booklet Part 1, section 2.
Choosing your investment timeline
As well as choosing your fund(s), you can choose how quickly or gradually you want to move your savings to your chosen fund(s).
Initially, your savings would move to a Secure Cash Investment. The Unit Price would be guaranteed to not to decrease from the initial investment date, although its value would be unlikely to keep pace with inflation. Your savings would then gradually transition to your chosen fund(s) over one of three timeframes one, three, or six months.
If you do not make an investment choice, your savings will stay in the Secure Cash Investment for six months and then gradually transition to the Automatic Investment Option over the following six months.
You can find out more by reading the Investment Choice Booklet, Part 1, sections 1 and 4.
Charges and taxation
Should the Proposal go ahead, it is important for you to understand any charges that apply to investing in Unit-Linked Funds.
The annual management charge on your Policy would cover the expenses of managing your money, including:
Levies, including those payable to regulators
The AMC that applies to each fund is either 0.50% or 0.75%, and is taken into account when the fund price of the individual Units is calculated each day.
The only other costs which may impact the fund are investment dealing costs, known as transaction costs. These costs on our existing funds can be found in our unit-linked section of our website. For the new funds, the indicative costs are shown in your Investment Choice Booklet.
See Part 1 of the Investment Choice Booklet, section 5 for more information.
What to do when you have made your choice
There is a form enclosed with your Investment Choice Pack. You will need to complete this form (one per policy) and return it to us to tell us your investment choice(s). If you need any help completing this form, you can call us on 0330 159 1530 or on +44 1296 385 225 if calling from outside the UK.
If your completed form is received before 13 December 2019, your investment choices will take effect on the Implementation Date, according to the timeline you have chosen to transition from the Secure Cash Investment to your chosen fund(s). If it is received after this date, your choices will take effect as soon as possible after it is received.
Please let us know if your personal circumstances mean you might benefit from additional assistance.
What you can expect and when
Who are Utmost and is my money safe with them?
Utmost Life and Pensions Limited (“Utmost”) is a life insurance and pensions company and they are regulated by the FCA (Financial Conduct Authority) and the PRA (Prudential Regulation Authority).
The Equitable Board believes that the deal with Utmost ensures a financially stable home for the Equitable’s Policies, and Policyholders will benefit from their strong capital position and operational management. Utmost has over 100,000 customers, and they handle around £1.7 billion of assets. It is part of the wider Utmost group of companies who has 240,000 customers and manage £33 billion of assets.
You can find more information about Utmost in paragraph 61 of Explanatory Booklet Part B and at Utmost’s website www.utmost.co.uk. Utmost’s Solvency & Financial Condition Report (SFCR) can also be found on the Utmost website at www.utmost.co.uk
What is the investment performance of Utmost Funds?
If the Proposal is approved by the High Court, the current Equitable Life Unit-Linked funds are going to be renamed and become Utmost Life and Pensions funds. You can find factsheets containing past performance data for these funds here.
After the Implementation Date, these funds will be invested jointly between Aberdeen Standard Investments (the Equitable’s current investment manager) and JP Morgan Asset Management.
JP Morgan are world class asset managers that have worked with Equitable and Utmost to create a new set of multi-asset and corporate bond funds. These funds have been specially designed with Equitable Life policyholders in mind. As these are new funds, there is no past performance data but the Utmost website will be updated with this information as it becomes available throughout 2020.
More details about the Unit-linked funds that are available can be found on the Utmost website www.utmost.co.uk
Will I still have the same retirement options as I have today, including taking a cash lump sum (UFPLS)?
Equitable customers will have the same range of options which they have today, after the transfer. In addition Utmost are developing Utmost Drawdown which will be an addition to the current options. The plan is to make this available to transferring Equitable UK Pension customers in early 2020.
Will I be able to purchase an annuity with Utmost?
Like today, Equitable customers will have the same range of options, after the transfer, including buying an annuity on the open market. In addition, Utmost are developing Utmost Drawdown which will be an addition to the current options. The plan is to make this available to transferring Equitable UK Pension customers in early 2020.
Will Utmost be able to offer me a drawdown option?
Utmost are developing Utmost Drawdown. The plan is to make this available to transferring Equitable UK Pension customers in early 2020.
Will I still be able to transfer or surrender my Policy if the Proposal is implemented?
If your policy terms currently allow you to surrender or transfer your benefits, then the proposed transfer to Utmost will not change that. And, subject to your Policy’s terms, there will be no period after the proposed Implementation Date that a transfer or surrender will not be possible.
The Equitable and Utmost urge you to think carefully before making any decision to surrender or transfer your Policy and to seek financial advice, including as to whether there would be any tax consequences of doing that.
You should be aware that some Policies may have terms that mean you cannot transfer or surrender the Policy Value. The documents you have received so far should confirm this, but you can call the helpline if you are not sure.
The transfer process currently takes some time whilst policyholders provide all the necessary documents and information and Utmost has agreed that for the first year after the Implementation Date it will meet the Equitable’s current service standards.
Will Utmost charge fees or penalties if I transfer my Policy to someone else?
Equitable do not charge exit fees or penalties, and for the first 12 months after the implementation date. Utmost has agreed to administer all Transferring Policies to an equivalent standard. Therefore, in that period Utmost are not entitled to charge any fees for a Policyholder exercising their right to transfer to another provider.
Currently Utmost also has no plans to introduce any such fees beyond that 12 month period.
Can a Policyholder transfer in to what will be their Utmost pension?
Utmost are currently developing Utmost Drawdown and will be considering fund consolidation into drawdown in 2020. There are no plans to allow other transfers in to Equitable pension plans.
Will Utmost charge more than Equitable?
Utmost have an arrangement with the Equitable regarding the ongoing Annual Management Charges (AMCs) relating to Transferring Policies, and Utmost has no plans to raise ongoing annual management charges.
A summary of the charges is below, and you can read more about the charges in paragraph 58 of Explanatory Booklet Part B.
A: for the first 12 months after the Implementation Date, AMCs for the Secure Cash Investment (available only to Scheme Policyholders) will not exceed 0.50% per year; and
B: AMCs for Transferring Policyholders invested in all other Unit-Linked Funds after the Implementation Date will typically not be more than 0.75% per year (and will not exceed 1%).
With-profits Policyholders
The current AMC for Equitable With-Profits Policyholders is 1.5%. If the Scheme and the Transfer go ahead, this would mean that their current level of AMCs would reduce from 1.5% per year to either 0.5% for the Secure Cash Investment (during the first year only) or typically 0.75% (and no more than 1%) for all other Unit-Linked Funds.
After the first 12 months
Paragraphs 58.2(c) and (d) of Explanatory Booklet Part B describe how Utmost has agreed that the only charges applied by it to Transferring Policies which are invested in Unit Linked Funds will be the annual management charges (described above), certain deductions set out in the policy terms and conditions to cover additional insurance benefits on some policies and any other charges already allowed for in the policy’s terms and conditions.
There will be no other charges applied by Utmost in respect of the investment management, administration or asset management costs, including fund management charges and custody charges, other than certain exceptions relating to the Property Fund and certain costs involved in buying or selling assets which will be reflected in the price of the units.
How is the Annual Management Charge (AMC) taken?
Utmost will continue to deduct the AMC from the current range of Equitable funds in exactly the same way as Equitable do now. The AMC is taken into account when the unit price is calculated each day. This approach will also be used for the new range of funds, including the three new multi assets funds.
The level of charges can be found on the Utmost website www.utmost.co.uk
Will Utmost apply bid/offer spread charges to With-Profits Policies that are converted to Unit-Linked?
If the Proposal is approved by the High Court and With-Profits Policies are converted to Unit-Linked Policies, no bid/offer spread will apply to the conversion. The Unit-Linked funds have a single price, so no bid/offer spread will apply on an ongoing basis to new premiums paid into Unit-Linked Policies.
When will Utmost Life and Pensions be able to tell me the new Uplifted value?
As your new provider, Utmost Life and Pensions will need to carry out work to ensure that all policies are valued and set up correctly at the Implementation Date. Although this work is likely to take around two weeks to complete, the Uplift will be applied as at 1 January 2020. You will be able to contact Utmost Life and Pensions from 1 January and they expect to be able to provide you with a policy value from mid-January. Alternatively, you can wait until you receive a letter from Utmost Life and Pensions in the New Year, which will confirm the new Unit-Linked value and provide details of what Unit-Linked Investment(s) you have chosen.
How will I find information on funds, pricing and switching?
The Investment Choice Pack we sent to policyholders in August and September contains details of the funds that would be available from Utmost Life and Pensions and you can find more information about the funds on Utmost’s website
If you are currently invested in Equitable unit-linked funds, these funds will be renamed and become Utmost Life and Pension funds click here for table of changes. There are factsheets for the UK funds on our website. Aberdeen Standard Investments will continue to manage some underlying investments in those funds.
Information about prices and how to switch funds will all be added to the Utmost website from January 2020. The process for switching funds will be unchanged from the Equitable process available today.
Will I lose money being invested in Unit-linked funds in a volatile market?
We understand that Equitable Policyholders may be concerned about this and we have taken that into account when designing the fund range with Utmost. For example, Policyholders have the option to go initially into a secure cash investment where the Unit Price would be guaranteed not to decrease from the price at the Implementation Date, although its value may not keep pace with inflation. There is also a range of funds to choose from which cater for the differing levels of risk Policyholders might want to take with their savings, including lower risk funds, and you can switch between funds at no cost.
Will the Transfer to Utmost adversely affect my Policy and/or investments?
The Transfer Independent Expert, whose appointment was approved by the PRA after consultation with the FCA, has considered in detail the effects of the proposed Transfer on the policyholders of both Equitable and Utmost. At the time of writing his Report, a copy of which can be found here, and summary of which can be found here, the Transfer independent Expert concluded, among other things, that he was satisfied that the Transfer will not materially adversely affect any group of policyholders, save that he was yet to finalise his conclusions in respect of Non-Transferring Policyholders. He explains that this was because the investment strategy for UK-style German With-Profits Policies was still under discussion at the time of issuing his report (which was required before the First Court Hearing). In addition, due to a late change to the Transfer, he had not yet concluded on the appropriateness of the proposed post-Scheme ELAS Capital Policy. However, he confirms that he is “satisfied that the other changes to these policies due to the Transfer are not expected to have a material adverse impact on this group of policyholders”. He goes on to say that he “will keep this matters under review until the date of the Sanction Hearing and will draw any significant developments or changes that may affect policyholders to the attention of the court in his Supplementary Report.” Since the time of his writing his Report, the Transfer Independent Expert has issued a Letter to the Directors of the Equitable and Utmost, confirming that he has now concluded on these outstanding aspects of the Transfer. You can find a copy of this Letter on the Equitable’s Website here. You can also find the full version of his report on the Equitable’s website here.
How are economic conditions impacting the Society and the Proposal?
Economic volatility is one of the reasons for the Proposal, particularly in this low interest rate environment. The biggest challenge the Society faces today in run-off is where policyholders take their benefits later than expected, interest rates remain low, the cost of guarantees in the future increase and we have to hold capital to cover that risk. The longer this situation continues the more it could impact the amount of capital we can pass back to With-Profits policyholders in the future as we maintain our solvency requirements.
Uncertainty in the markets also impacts on the expected level of the uplifts applied to Scheme Policies should the Proposal proceed. However, the Equitable has taken steps to protect the assets in the With-Profits fund from market volatility in the period until the Scheme would be implemented. Financial instruments, known as derivatives, have been purchased and are being managed carefully to ensure that assets, and therefore the proposed uplift, is protected against changes in interest rates.
The derivatives have achieved what we set out to do: to keep asset values, and consequently uplifts, at a high level, against a backdrop of big swings in interest rates. As a result, the uplift available to add to With-Profits policies may be higher than that used in the illustrations sent to policyholders, but is unlikely to be materially lower.
At implementation, the Scheme requires Utmost Life and Pensions to ensure that the level of capital is higher than the regulatory minimum. We consider this also protects against changes in economic conditions. Further details can be found on page 107 of Explanatory Booklet Part B and page 2 of the Scheme document
Will Brexit impact the Proposal ?
Brexit uncertainty is one of the reasons that we have seen volatility in some investment markets and this could continue.
Policyholder funds are invested in such markets, so there is the potential for the amount available for distribution under the Proposal to be affected. The value of assets used to back the Primary Uplift is unlikely to change materially because the Equitable has entered into financial agreements which effectively fix the value of those assets for the time being so that, while uplifts could be higher than that used in the Personal Illustrations, they are unlikely to be materially lower.
Policyholders have been asked to choose which unit-linked funds they want to be invested in if the Proposal goes ahead. If they make no investment selection, their policy value will be invested in a Secure Cash Fund for at least six months after Implementation Date – the amount of their investment will not decrease in value from the Implementation Date during this time, although its value may not keep pace with inflation. Then investments will be moved over the next six months into the automatic investment option for their policy.
By selecting which unit-linked fund to invest in, policyholders can choose the level of risk exposure appropriate to them, including low risk Money Funds, and can switch between funds at no cost.
These points are expanded further here
Why is the Equitable making this Proposal?
Running the Equitable involves risk, just like any other business. We have to hold back money (capital) in case those risks materialise. Because we have to hold this capital, it cannot be paid to With-Profits Policyholders when they take their benefits.
The Equitable aims to get capital back to Policyholders as fairly and as soon as possible and the Proposal is intended to do that.
The Proposal is made up of two parts:
Part one - known as the Scheme - would:
Increase With-Profits Policy Values with an immediate, one-off Uplift
Part two – known as the Transfer - would:
Transfer all of the business of the Equitable to Utmost Life and Pensions Limited, except for certain Excluded Policies such as German Policies and Irish Policies that will remain with the Equitable, which will become a subsidiary of Utmost.
If the Proposal is implemented, it will affect all Policyholders. Ownership will transfer to Utmost, and your Policy will be with them and not the Equitable. You cannot opt out.
The Proposal is one of many options we have looked into, and the Board feel it is the best way forward, but you need to make your own decision. Details of the alternative strategies that were considered can be found on page 23 of Explanatory Booklet Part B.
Explanatory Booklet Part A, section 3, contains a more detailed summary of the Proposal and what it entails.
As with all investments and plans, there are risks involved. The Board recognises this and has tried to balance those risks wherever possible, but Scheme Policyholders needed to be aware of the risks to help them decide how to vote and these are shown below:
Scheme Policyholders would no longer be invested in With-Profits Funds and would lose any Investment Guarantees and any With-Profits Switching Rights;
Scheme Policyholders may not feel that the Uplift is an adequate reward to cover the removal of any Investment Guarantee;
Unit-Linked Funds are not subject to ‘smoothing’ and the returns Policyholders would get would be subject to the ups and downs of the investment markets; and
Future investment returns may be less than projected and may be lower than the projection in the Personal Illustration.
If the Proposal does not go ahead
If the Proposal does not go ahead, the Equitable would remain in Run-Off. Under these circumstances there are risks that Capital Distribution may fall or be removed. The specific risks are:
Policyholders can choose to retire or take their benefits later than we expect. When Policyholders stay longer than expected, we have to reinvest our assets and in the current low interest rate climate, it is not possible to match the return that is required by the Investment Guarantee;
We would have to continue to set aside capital to mitigate the risk of not being able to pay future benefits to Policyholders
The Equitable may become too small to function efficiently
What if the Proposal doesn’t go ahead?
If the Proposal does not go ahead, then your Policy would continue as it is now. With-Profits Policies would remain invested in the With-Profits Fund. The challenges of operating the With-Profits Fund will remain, all of which have the potential to impact your Policy in the future.
You can read more about these challenges on page 30 of Explanatory Booklet Part A and page 23 in Explanatory Booklet Part B.
How will the Equitable make sure the Proposal is fair?
The Board continues to act in the interest of Policyholders as a whole and is keen to ensure that the Proposal is a fair one. However, it is possible for the Proposal to be fair and in the interests of Policyholders as a whole yet not in the interest of every Policyholder. Your personal circumstances are unique to you and will dictate whether the Proposal is the right thing for you.
To ensure the Proposal is fair, it has been scrutinised by the With-Profits Actuary, as well as two independent experts, the Policyholder Independent Expert and the Transfer Independent Expert. Both experts will provide a report to the High Court and the UK financial regulators, the Financial Conduct Authority and Prudential Regulation Authority.
To help the Equitable assess the fairness of the Proposal, we created a series of six tests, called Fairness Indicators, which are shown below.
All six Fairness Indicators are passed for all Scheme Policies.
How the voting process worked?
The Proposal included two votes.
1 The vote on the Scheme
This vote covered the Scheme and related to the proposed Uplift in Scheme Policyholders’ Policy Values, the removal of the Investment Guarantee and the conversion from With-Profits Policies to Unit-Linked Policies. Set targets had to be reached for this vote to pass.
2The vote on the Change to the Articles
This was a vote on a Special Resolution on the Change to the Articles to make Utmost Life and Pensions the sole Member of the Equitable.
As with the vote on the Scheme, there were a minimum number of votes required for it to be passed:
Voting closed on 1 November 2019. The Proposal on the Scheme and the Change to the Articles were passed at the Policyholders’ Meeting and the EGM; details of the outcome of the votes can be found here. The Equitable will now ask the High Court to approve the Scheme and the Transfer at the Second Court Hearing starting on 22 November 2019. If the High Court gives that approval, then we expect the Proposal to be implemented with effect from 1 January 2020.
If you wish to object to the Scheme and/or the Transfer or have any concerns, please do let us know. You can raise your concerns or objections in the following ways:
By writing to our solicitors, Attention Craig Montgomery and Kevin Whibley, Freshfields Bruckhaus Deringer LLP, 65 Fleet Street, London EC4Y 1HS
By email to our solicitors at equitable@freshfields.com
By telephone, between 9.00 a.m. to 5.00 p.m. on UK working days. Calls to 03 numbers are charged at no more than a call to a standard 01 or 02 number.
Individual Policyholders:
From the UK: 0330 159 1530
From outside the UK: +44 1296 386 242
Group Scheme Trustees:
From the UK: 0330 159 1531
From outside the UK: +44 1296 385 225
Holders of German Policies: 01803 234 630
In person (or by legal representative) at the Second Court Hearing following the vote.
We will make a record of your concern or objection and provide a copy to the Policyholder Independent Expert, the Transfer Independent Expert and the High Court, along with a copy of our response.
Notifying us of your objection in advance of the Second Court Hearing does not affect your right to attend and make your objection in person at this Hearing.
Full details on who to contact can be found in Explanatory Booklet Part B under the ‘Paths to help’ section.
Click below to expand for more information
Introduction to the Scheme sent to Scheme Policyholders
The Hearing at which the Equitable sought the High Court's permission to hold the Policyholders’ Meeting.
The Decision Pack which includes the Explanatory Booklets and Voting Forms sent to Scheme Policyholders and Members
August 2019, after the First Court Hearing
This pack provided you with details of the Proposal so that you could decide how to vote and whether to raise an objection.
Provided information explaining the Unit-Linked Funds that are available for your Policy, if the Scheme were to become effective. You should decide on a Unit-Linked Fund(s), seeking any advice you need.
Deadline for receipt of Voting Forms for the Extraordinary General Meeting
10.00 a.m. on
The closing date for postal votes on the Change to the Articles.
Deadline for online Voting Forms for the Change to the Articles.
The closing date for online voting on the Change to the Articles..
Deadline for receipt of postal Voting Forms for the Policyholders’ Meeting
The last date for receipt of postal votes on the Scheme.
Deadline for online voting on the Scheme.
The closing date for online voting on the Scheme.
Policyholders’ Meeting on the Scheme.
The meeting of Scheme Policyholders for the Scheme vote.
1 November 2019, held immediately after the Policyholders’ Meeting that starts at 10.00 a.m.
The meeting of the Equitable's Members for the vote on the Change to the Articles..
10.30am on
The High Court Hearing to seek approval of the Scheme and the Transfer.
Confirmation on the Equitable's and Utmost's websites that the Scheme and Transfer have been approved.
Confirmation of the High Court decision published on our website.
The deadline for receipt of Investment Choice Forms to process your investment choice at the Implementation Date
The last date for implementing investment choices at the Implementation Date. You are still able to make a choice following this.
Planned date for Scheme and Transfer to be effective (your With-profits policy would be uplifted and would become unit-linked, while Investment Guarantees would be removed.) Utmost become the sole member of the Equitable.
Planned date for the Scheme and the Transfer to be effective (your With-profits policy would be uplifted and would become unit-linked, while Investment Guarantees would be removed.)
Utmost become the sole member of the Equitable.
Utmost Life and Pensions is a life and pensions company operating in the UK. They currently look after 100,000 customers, with £1.7bn of assets, and are also part of the wider Utmost Group of Companies; a growing specialist life assurance group currently managing £33bn assets under administration and 240,000 customers.
Utmost would provide a wide range of investment options for you to choose from, and details of the funds available are set out in the Investment Choice Pack sent in a separate mailing after the Decision Pack.
Click on Latest news and FAQs above to find some FAQs about Utmost.
You can find out more about Utmost Life and Pensions on their website at www.utmost.co.uk., including a dedicated section for Equitable Life policyholders
How your With-Profits Policy works
With-Profits Policies are long term investments which contain some special features – often in the form of guarantees and bonus payments.
Unlike unit-linked investments where the fund value is directly linked to the performance of the underlying investments, the Equitable’s With-Profits Policyholders are entitled to participate in the profits and losses made by the company. This means the costs of running the business are shared amongst all its With-Profits Policyholders.
‘Smoothing’ of investment returns is another feature of With-Profits Funds. This means in good years not all the growth of the fund is allocated to Policy Values and some is held back to subsidise poor years.
The Equitable With-Profits Policies include an Investment Guarantee, which is the minimum that will be paid when Policyholders take their benefits at a time when the Investment Guarantee applies (such as retirement or maturity). Some of the Equitable Policies also include a guaranteed annual increase which applies to the Guaranteed Value of your Policy .
Your Personal Illustration shows what Investment Guarantee you have in your Policy.
Over recent years the Equitable has been able to distribute, or share, some of its capital to With-Profits Policyholders when they take their benefits. This is known as Capital Distribution.
The current Capital Distribution is 35% of Policy Value at 31 December 2014. However, it is important to understand that in the future, this could be higher or lower or could even be completely removed.
Most of the Equitable’s With-Profits Policies have a Policy Value and Guaranteed Fund that can be calculated at any time. These are Recurrent Single Premium Policies. Other With-Profits Policies are not managed using Policy Values or Guaranteed Fund values. These are Conventional With-Profits Policies. Their guaranteed benefits are set out in the contract along with the contractual premiums that will be paid.
The example is for Recurrent Single Premium Policies. If you have a Conventional With-Profits Policy and would like help to understand how your Policy works, please contact us.
How your Unit-Linked Policy would work if the Proposal goes ahead
If the Proposal goes ahead, your uplifted With-Profits Fund Value will be used to buy Units in your chosen Unit-Linked Funds.
Different Unit-Linked Funds are available and you can choose which fund or funds are right for you. Some provide a low return with little risk of not getting your money back but may not keep pace with inflation, while other funds can provide potentially higher returns but with a higher risk to your money.
The value of Units in each Unit-Linked Fund will go up or down in line with the value of the underlying investments and the value of a Unit-Linked Policy is not guaranteed and you may not get back the amount of your original investment.
You can read more about how Unit-Linked Policies work in Explanatory Booklet Part A and in the Investment Choice Pack.
Investment & Pension Scams
Be aware that scammers may use the Proposal we are making as a good opportunity for them to take advantage of you.
A scam is where a fraudster tries to gain access to your savings, which may result in money being moved, stolen, or subject to unreasonable charges. The aim of the scammers is to profit from your money, not to help you access or increase the value of your savings as they may claim.
Scams usually begin by you being unexpectedly contacted about your savings with an offer that sounds too good to be true. Look out for:
Out of the blue phone calls, texts, emails, internet ads, or door to door calls by someone wanting to discuss your savings. Unrequested contact by phone, text or email to market pensions is illegal in the UK;
Offers of a way to access your pension savings before you’re age 55, or encouraging you to move your savings elsewhere for a higher return;
Offers to convert your pension to cash before age 55 (sometimes known as pension liberation) are usually scams as it’s not typically possible to access your pension before 55 unless you are seriously ill. These offers have serious tax implications as taking your pension early can result in paying up to 70% in tax on your savings;
Offers to those over 55 to invest their savings in bogus schemes that promise higher than usual returns. You should always speak to an authorised and regulated financial services company or financial adviser before deciding what to do with your pension pot;
Offers of a free pension review;
Offers of loans, cashback, or advances on your savings;
Aggressive or hurried sales techniques, such as offering incentives for quick decisions.
What to do if you think you’ve been approached by scammers
Check if the person or company who contacted you is legitimate through the Financial Services Register at https://register.fca.org.uk or call the Financial Conduct Authority on 0800 111 6768.
If you are contacted by someone claiming to be from a company you recognise, but you are unsure if it is legitimate, end the conversation, find the published telephone number of the company on the Financial Services Register and call them directly.
Never give any personal or financial details if you have been unexpectedly contacted or are in any way unsure whether the company is legitimate.
Check everything yourself; don’t be tempted to invest just because a friend or family member suggests it or reassures you that it’s safe.
If you are concerned about any communications that you have received from the Equitable, you can call us on 0330 159 1530 (or +44 1296 386 242 if overseas) to confirm if they are genuine.
Report it to the Financial Conduct Authority on 0800 111 6768 or via their online reporting form.
Report it to Action Fraud on 0300 123 2040 or at the Action Fraud website.
If you’re worried that you’re in the process of being scammed in relation to your Equitable Life policy, call us immediately on 0330 159 1530 (or +44 1296 386 242 if overseas).
The FCA provides more information on pension and investment scams and how to protect yourself.
FCA - ScamSmart
Cifas is a not-for-profit fraud prevention organisation that helps protect individuals and organisations against fraud.
Individuals | Cifas
0330 100 0180
The Pensions Advisory Service provides more information on pension and investment scams as well as general guidance .
Money Advice Service offers advice and guidance on all money-related matters, including investments.
Group Specific Communications
It is important Trustees make their investment fund choice on behalf of their members, and the information we have sent is designed to help you do that.
Member Specific Data
If we hold a confirmed email address for your pension scheme, we will have sent a link to a secure portal where you can find Member Specific Data. If we were unable to confirm with you an email address for your pension scheme, we included the Member Specific Data in your pack.
This data shows how your members’ with-profits investments may increase, and what Investment Guarantee would be removed, together with a projection showing how this might look at a particular point in the future, if the Proposal is approved. It also provides a comparable set of values should the Proposal not go ahead. We have also included the return required on the uplifted investments, to match the with-profits Guaranteed Values that would have been available at the member’s retirement date we have on record, if the Proposal did not go ahead.
An example of the Member Specific Data sheet which includes an explanation of the items shown.
The covering letter sent to your scheme as part of the Decision Pack set out whether you were entitled to vote in the two votes.
Trustees were able to split their votes on the Scheme and the Change to the Articles, to take into account the possibility of different preferences of your pension scheme members.
More details about the votes are included in Section 14 of Explanatory Booklet Part A and Section D of Explanatory Booklet Part B.
Voting closed on 1 November 2019. The Proposal on the Scheme and the Change to the Articles were passed at the Policyholders’ Meeting and the EGM; details of the outcome of the votes can be found here.The Equitable will now ask the High Court to approve the Scheme and the Transfer at the Second Court Hearing starting on 22 November 2019. If the High Court gives that approval, then we expect the Proposal to be implemented with effect from 1 January 2020.
We recognise that we have provided you with a lot of information and making a decision on behalf of the pension scheme you are responsible for may not be straightforward. Your Employee Benefit Consultant (EBC) or advisers should be able to help you with this decision. We are happy to provide information to your EBC or adviser if we have authority to do so, or if you provide that authority. Alternatively, we have set up a dedicated helpline to provide support and guidance on the Proposal.
Please let us know if you need help in communicating the Proposal to your Members. You can contact us in the following ways:
Phone: UK callers: 0330 159 1531 (Calls are charged at your local rate when phoning from a UK land line)
Outside the UK: +44 1296 385 225
Lines are open from 9am to 5pm on normal working days. Calls to 03 numbers are charged at no more than a call to a standard 01 or 02 number.
Letter: Equitable Life, Walton Street, Aylesbury, Bucks, HP21 7QW
Email: UK Schemes, Irish and International Group Schemes
Website: www.equitable.co.uk
If the Proposal goes ahead, then Irish With-Profits Policies will receive an immediate Uplift to the Policy Value and then convert to Unit-Linked Policies.
There is a risk that an investment may lose value due to the difference in value between two different currencies.
Instead of transferring to Utmost, the Unit-Linked Policies will remain with the Equitable, which will become a subsidiary of Utmost.
You will find a more detailed explanation in the Explanatory Booklet Part A
Link to your document library.
Advice confirmation & payment
If your client wishes to use their own adviser, then they will need to call the Equitable so that they can register their request and be issued with the IFA subsidy claim form that you, as their existing adviser, would need to complete once your client has received the advice.
The Equitable will subsidise up to a maximum of £355 for you to provide advice to an existing client with an Equitable With-Profits Policy. If your fees are more than that, your client will need to pay the rest. The Equitable will pay their contribution directly to you, not the Policyholder.
You will need to request payment by:
Completing an Advice Confirmation Slip
Confirming to the Equitable that you have the appropriate permission from the FCA to provide advice
Claims must be submitted to Equitable Life by 13 December 2019.
The section on our main website cover the most common questions we receive from Financial Advisers.
There is a full glossary relevant for the Decision Pack in Explanatory Booklet Part B and for the Investment Choice Pack in Investment Choice Booklet Part 2.
Annual Management Charge (AMC) A charge covering the costs of managing a fund, expressed as a percentage of the value of your investment.
Articles The articles of association of the Equitable.
Automatic Investment Option The default fund or strategy in which your savings would be invested if you do not make another investment choice and the Proposal goes ahead.
Board The board of directors of the Equitable.
Bonds A financial instrument issued by a government or company to borrow money for a fixed period, at an agreed interest rate.
Capital Distribution Capital distribution is an amount that is currently added to the Policy Value when a Policy matures or a Policyholder takes their benefits. For Recurrent Single Premium Policies, we take the Policy Value as at 31 December 2014 and allocate an extra capital distribution of £350 to every £1,000 (i.e. 35%) of that underlying value. Conventional With-Profits Policies have final bonus rates set to achieve consistency with Recurrent Single Premium Policies, allowing for Capital Distribution.
Cash deposits Money held in a savings account or Money Market Fund.
Cash funds/Money Market funds A fund that invests conservatively in low-risk instruments, with the aim of protecting the value of your investment.
Change to the Articles A special resolution proposing an amendment of the Equitable’s Articles of Association making Utmost the sole member of the Equitable with effect from the Implementation Date, should the Scheme Policyholders vote in favour and the High Court approve the Scheme.
Chief Actuary A person appointed as head of the Equitable’s Actuarial Function under 6.1R of the Conditions Governing Business section of the PRA Rulebook.
Chief Executive Simon Small.
Conventional With-Profits Policy This sort of policy starts with a guaranteed amount, known as the sum assured, that you will get if you pay all the premiums due. Bonuses, both guaranteed and non-guaranteed, which have been allotted by the Equitable are added to this guaranteed amount. Examples of this type of policy are:
certain Whole of Life plans, which pay out when you die; and
certain endowments, which pay out a lump sum at the end of the policy, or when you die, if this is earlier.
Corporate bonds A bond issued by a company.
EGM or Extraordinary General Meeting The Extraordinary General Meeting of the Equitable to be held in order for the Eligible Members to vote on the Change to the Articles.
Eligible Member A Member who is entitled to vote at the EGM in accordance with the Articles. Broadly, the requirements for being an Eligible Member are that:
The policyholder must be the original first named grantee of the With-Profits Policy;
The With-Profits Policy must have a total sum assured (calculated in accordance with the Articles) of at least £1,000.
For more details, see the Articles, which can be found online at www.equitable.co.uk.
Equitable, the The Equitable Life Assurance Society, a company registered in England and Wales with company number 00037038.
Equity/Equities (Shares) A financial instrument that gives you a share in a company. The price goes up or down based on how well the company is currently doing, or what its prospects are.
Excluded Policies Policies which are excluded from the Transfer, including the German Policies, Irish Policies and any other Policy which is not capable of being transferred to Utmost under the terms of the Transfer.
Fairness Indicators A suite of objective criteria used by the Board to assess whether a certain scheme outcome could be considered to be fair.
First Court Hearing The High Court hearing to give directions in relation to the Scheme and the Transfer which took place on 22 July 2019.
Fluctuations/Market fluctuations Changes in asset prices, both up and down.
Fund(s) An investment vehicle in which your money is pooled with that of other investors to buy shares, bonds or other assets.
German Policy A Policy governed by German law.
German With-Profits Policies German With-Profits Policies are comprised of two types of Policy: German Style German With-Profits Policies and UK Style German With-Profits Policies.
Gilt/Gilt-edged security A bond issued by the UK government.
GMP Guaranteed minimum pension provided by certain policies held by a small number of Scheme Policyholders.
Government bond(s) A bond issued by a government.
Group Pension Policies These are Scheme Policies which provide benefits which are payable to individual members of group pension schemes under the terms of those schemes.
Group Scheme Trustee The trustee of the relevant group pension scheme. This could be an individual, a group of individuals or a company, and the identity of that person (or members of that group of people) may change over time.
Growth The profit on an investment, also known as ‘return’.
Guaranteed Fund/Value Recurrent Single Premium Policies’ Guaranteed Fund/Value is the minimum amount which the Equitable must pay under the Scheme Policy if it is greater than the Policy Value. The amount of the Guaranteed Fund/Value depends on the terms of the Investment Guarantee (including any guaranteed annual increase). The main components of this sum are:
the premiums paid minus any deductions where Scheme Policyholders have taken benefits or exercised With-Profits Switching Rights;
any deductions in accordance with relevant policy terms for expenses and charges;
any guaranteed bonuses or other uplifts which have been allotted by the Equitable to that Sub-Policy or Scheme Policy; and
if applicable, any guaranteed net annual increase of 2.5% or 3.5% per year which has been allocated to that policy.
High Court The High Court of Justice in England and Wales.
Implementation Date If the Scheme Policyholders vote in favour of the Scheme, and the High Court approves the Scheme and the Transfer, the date on which:
the key aspects of the Scheme (Policy Values are uplifted, With-Profits Policies become Unit-Linked Policies, and Investment Guarantees are removed) would be implemented;
the Change to the Articles will become effective; and
the Transfer will be implemented.
This is expected to be 1 January 2020.
Inflation A measurement of how fast the cost of living is rising.
Investment Choice Form The form which Scheme Policyholders can use to choose Unit-Linked Funds if the Scheme goes ahead. This will be provided to Scheme Policyholders as part of the Investment Choice Pack.
Investment Choice Pack Pack provided to Scheme Policyholders containing certain forms and documents, including the Investment Choice Form, which will help you to decide which Unit-Linked Fund to invest in, and to tell us what decision you have made.
Investment Guarantee A promise that when a Scheme Policy pays out benefits at a time and in circumstances described in the policy, the Equitable will pay a minimum amount and that amount is based on the amount that the Scheme Policyholder has paid in premiums.
This amount takes account of any guaranteed bonuses which have been allotted by the Equitable.
Investment Guarantees do not include benefits which are payable only on the occurrence of specified life events (such as death, or being diagnosed with a particular medical condition, or undergoing specified hospital surgery).
Investment Guarantees do not include GARs or GMPs.
Irish Policy A Policy governed by Irish law.
Irish With-Profits Policies A Policy governed by Irish law which confers on its holder a right to participate in the profits and losses of the Equitable.
JLT JLT are an experienced employee benefits firm which, following a rigorous selection process, was appointed by the Equitable to give you further support if required.
Member A member of the Equitable.
Money Market Fund A Unit-Linked Fund established for policies denominated in GBP. More details about Unit-Linked Funds are set out in paragraph 22.21 Explanatory Booklet Part B and also in the Investment Choice Pack.
Money Market/Cash funds A fund that invests conservatively in low-risk instruments, with the aim of protecting the value of your investment.
Multi-Asset fund A fund that invests in a mix of different asset classes, such as shares, bonds, property and cash.
Multi-Asset Moderate Fund A Unit-Linked Fund established for policies denominated in GBP. More details about Unit-Linked Funds are set out in paragraph 22.21 of Explanatory Booklet Part B and also in the Investment Choice Pack.
Pension Policies This means a Scheme Policy which (i) is a With-Profits Policy; (ii) has the primary purpose of providing retirement benefits for a specified individual named in the Scheme Policy; (iii) is denominated in GBP; and (iv) whose Policy Value is accumulated with returns gross of tax.
Personal Illustration The document provided to Scheme Policyholders with this booklet which contains details about how the Scheme would affect that Scheme Policyholder.
This provides you with an indication of what you may receive if the Proposal goes ahead, and what this might look like at a point in the future. It also allows you to compare this with the projected position at a future date. It will help you understand the current value of your Policy, the amount that this may be increased by and, where applicable, the Investment Guarantee that would be removed if the Proposal goes ahead.
Policy A contract of insurance or reinsurance written where the Equitable is the insurer or reinsurer.
Policy Value The Policy Value reflects the investment return which the Equitable applies over time to premiums which have been paid, which is “smoothed”. The main components of this sum are:
the premiums paid in relation to that Scheme Policy;
an adjustment, determined by the Equitable, which reflects smoothed investment returns during the period that the relevant Scheme Policy has been held; and
any deductions in respect of switches to Unit-Linked Funds or partial withdrawal of benefits. Where Policy Value is used to describe the operation of the Proposal, this includes the surrender value for Conventional With-Profits Policies (but does not include any Capital Distribution) (see paragraph 20.8 of Explanatory Booklet Part B).
Policyholder The person named as the holder of a Policy.
Policyholder Independent Expert Trevor Jones, a partner at KPMG. This is who we have appointed with the FCA’s approval to consider whether the Scheme is in Scheme Policyholders’ interests and to prepare a report for the High Court.
Policyholder Independent Expert Terms of Reference These are the things that the Policyholder Independent Expert considered in preparing his report. They are available for inspection (see Appendix XI) and were agreed by the FCA.
Policyholders’ Meeting The meeting of Scheme Policyholders that the Equitable will call, since the High Court gave permission at the First Court Hearing, at which Scheme Policyholders can vote on the Scheme. It will take place at 10.00 a.m. on 1 November 2019.
Premiums/Contributions Money paid into your policy.
Proposal The Equitable's Proposal to allocate its assets to its With-Profits Policyholders through the Scheme, the Change to the Articles, and the Transfer.
Recurrent Single Premium Policy This means a policy under which each premium secures its own guaranteed benefit. All of these guaranteed benefits added together make up the guaranteed amounts we must pay the beneficiary at times given in the policy.
Run-Off A process by which an insurance company no longer enters into new policies, but continues to meet its obligations under existing policies.
Scheme The proposed scheme of arrangement between the Equitable and Scheme Policyholders under Part 26 of the Companies Act 2006, as further detailed in this booklet.
Scheme Effective Date The date on which the order of the High Court sanctioning the Scheme would be delivered to the Registrar of Companies in England and Wales for registration. This is expected to be approximately 25 November 2019.
Scheme Policyholder A person to whom the Equitable is required to make payments under a Scheme Policy.
Second Court Hearing The High Court hearing of the Equitable's application for an order that the Scheme and the Transfer be sanctioned, expected to take place on 22 November 2019 at the Royal Courts of Justice, 7 Rolls Buildings, Fetter Lane, London, EC4A 1NL, UK.
Secure Cash Investment A fund established specifically for the purposes of the Automatic Investment Option. The price of Units in this fund shall not decrease during the first twelve months from the Implementation Date.
Shares/Equities A financial instrument that gives you a share in a company.
Switch/Switching Selling your holding of one fund to buy units of another fund managed by the same firm.
Transfer The transfer of the Transferring Business from the Equitable to Utmost. This will take place by way of a Part VII Transfer. A “Part VII transfer” is the name sometimes given to a transfer of insurance business under Part VII of the Financial Services and Markets Act 2000 (FSMA). It is a statutory scheme whereby the liabilities of one insurer and corresponding assets are transferred to another insurer. The process that must be followed is stringent to ensure that policyholders are protected. To be effective, the Transfer is required to be sanctioned by the High Court. In considering a Part VII transfer, the High Court will take into account the views of the PRA, the FCA and the Transfer Independent Expert, whose appointment must be approved by the PRA in consultation with the FCA, and any objections made by affected parties such as policyholders and reinsurers.
Transfer Independent Expert Richard Baddon. He is a partner in the Actuarial and Risk practice of Deloitte. This is who we have appointed with the approval of the PRA in consultation with the FCA, to consider the terms of the Transfer, and to prepare a report for the High Court.
Unit A notional share of a Unit-Linked Fund. Details of the change to Unit-Linked Funds are contained in Appendix IV of Explanatory Booklet Part B.
Unit Price The value of a Unit to be allocated. This is decided with regard to the prices at which the Units in the related Unit-Linked Fund might be purchased or sold by the Policyholder. Details of the change to Unit-Linked Funds are contained in Appendix IV of Explanatory Booklet Part B.
Unit-Linked An investment vehicle in which your money is pooled with that of other investors to buy shares, Bonds or other assets. When you invest, you buy units in the fund. The value of the units will rise or fall depending on the performance of the investments held by the fund.
Unit-Linked Fund A notional fund maintained in the Equitable’s records for the purpose of calculating the benefits payable under a Unit-Linked Policy. If the Proposal is approved, after the Implementation Date, existing Unit-Linked Funds that are offered by the Equitable will be offered by Utmost. Details of the change to Unit-Linked Funds are contained in Appendix IV of Explanatory Booklet Part B.
Unit-Linked Policy A policy, which is not a With-Profits Policy, under which amounts that are payable to policyholders are determined by multiplying the Unit Price by the number of Units held. Details of the change to Unit-Linked Funds are contained in Appendix IV of Explanatory Booklet Part B.
Uplift The increase to the Policy Value of each Scheme Policy to be implemented under the Scheme made up of the Primary Uplift and the Secondary Uplift.
Utmost Utmost Life and Pensions Limited, a company registered in England and Wales with number 10559664 (formerly known as Reliance Life Ltd). Their website is: www.utmost.co.uk.
Voting Forms The blue and green forms enclosed with this booklet which Scheme Policyholders who are entitled to vote on the Scheme and Eligible Members who can vote at the EGM, can use to appoint a proxy for the Policyholders’ Meeting and the EGM.
Voting Value The value of a Scheme Policyholder’s claim against the Equitable as at 1 April 2019, as indicated on the pre-printed voting form that Scheme Policyholders will receive in the summer.
With-Profits A type of fund that gives you a share of the profits and losses of the business as well as the investment returns in the form of bonuses. A technique called ‘smoothing’ is used to reduce fluctuations in the size of bonuses, and the fund may have an Investment Guarantee that specifies the minimum amount payable on retirement, death or at policy maturity.
With-Profits Fund The Equitable's With-Profits Fund.
With-Profits Policy A policy which entitles its holder to participate in the Equitable's profits and losses. Such policies include any Unit-Linked Policy to the extent that With-Profits Switching Rights were exercised under it on or before 31 December 2017 and its holder had an entitlement to participate in the Equitable's profits and losses on that date.
With-Profits Policyholder A person to whom the Equitable is required to make payments under a With-Profits Policy.
With-Profits Switching Rights The right to invest in the With-Profits Fund by making a premium payment or a switch of investments into the With-Profits Fund.
The Introduction to the Scheme
Introduction to the Scheme Booklet
The Decision Pack
The Covering Letter *
The Explanatory Booklet A
The Explanatory Booklet B
The Investment Choice Pack **
Investment Choice Booklet Part 1
Investment Choice Booklet Part 2
The Scheme Document - The document setting out the terms of the Scheme
The Transfer Document - The document setting out the terms of the Transfer
Jersey Scheme Document
Guernsey Scheme Document
The Policyholder Independent Expert Summary Report
The Policyholder Independent Expert Report
The Policyholder Independent Expert Supplementary Report
The Policyholder Independent Expert Terms of Reference
The Transfer Independent Expert Summary Report
The Transfer Independent Expert Report
The Transfer Independent Expert Supplementary Report
The Transfer Independent Expert Terms of Reference
The Transfer Independent Expert Letter
Reports prepared by the Equitable’s actuaries in connection with the Scheme and the Transfer
With-Profits Actuary Report
With-Profits Actuary Supplementary Report
Chief Actuary Report on the proposed Scheme
Chief Actuary Report on the proposed Transfer to Utmost
* You can find variations of these documents for different Policyholder groups on our website here https://www.equitable.co.uk/policyholders/letter-library/ or https://www.equitable.co.uk/policyholders/international-policyholders/ for International Policyholders
** These documents are for individual Policyholders only
Even though your Policy is not currently invested in the With-Profits Fund, it is still important that you understand how the Proposal may affect you. Although the Proposal does not change the terms and conditions of your policy, it would be affected by the Transfer to Utmost Life and Pensions, if the Proposal is approved.
If you feel that you may be adversely affected by the Transfer, you do have the legal right to object.
This website provides you with information about the Proposal, but for more detailed information, you should read the recent communications we have sent you.
The Proposal on the Scheme and the Change to the Articles were passed at the Policyholders’ Meeting and the EGM.
If the High Court gives that approval, then we expect the Proposal to be implemented with effect from 1 January 2020.
About the Transfer to Utmost
As part of the Proposal, the Equitable would transfer all of the business of the Equitable to Utmost Life and Pensions, except for certain Excluded Policies such as German Policies and Irish Policies that will remain with the Equitable, which will become a subsidiary of Utmost. This part of the Proposal is the Transfer.
The terms and conditions of your Policy would not be affected by the Transfer should the Proposal proceed.
Part of the agreement the Equitable has reached with Utmost in relation to the Proposal is for Utmost to become the sole Member of the Equitable. This would be achieved by a Change to the Articles, which you can read more about in Section C of Explanatory Booklet Part B.
What if the Proposal does not go ahead?
If the Proposal does not go ahead, the Equitable’s business would not be transferred to Utmost Life and Pensions and we would continue to run the Equitable as we do now and service your Policy as normal.
Remove any Investment Guarantees, (including any guaranteed annual increases) and With-Profits Switching Rights
Transfer almost all of the Equitable’s business to Utmost
The Proposal is one of many options we have looked into, and the Board feel it is the best way forward. Details of the alternative strategies that were considered can be found on page 23 of Explanatory Booklet Part B.
The Explanatory Booklet Part A, section 3, contains a more detailed summary of the Proposal and what it entails.
This pack provided you with details of the Proposal and how to raise an objection if you wish to.
Policyholders’ Meeting on the Scheme
The meeting of the Equitable's Members for the vote on the Change to the Articles.
Confirmation on the Equitable's and Utmost's websites that the Scheme and Transfer have been approved
Planned date for Scheme and the Transfer to be effective. Utmost become the sole member of the Equitable.
If you wish to object to the Proposal or have any concerns, please do let us know. You can raise your concerns or objections in the following ways:
Investment with Utmost
If the Proposal goes ahead, any existing unit-linked investments you have would be transferred to Utmost Life and Pensions. The existing Unit-Linked Funds in the Equitable will be renamed and become Utmost Life and Pension funds. click here for table of changes. There are factsheets for the UK funds on our website. Aberdeen Standard Investments will continue to manage some underlying investments in those funds.
If the Transfer proceeds, you may have the opportunity to move your savings into the new Utmost Life and Pensions funds and we recommend you contact them after the Transfer to discuss your options.
You can find more information about the funds available at Utmost’s website
Capital Distribution Capital distribution is an amount that is currently added to the Policy Value when a Policy matures or a Policyholder takes their benefits. For Recurrent Single Premium Policies, we take the Policy Value as at 31 December 2014 and allocate an extra capital distribution of £350 to every £1,000 (i.e. 35%) of that underlying value. Conventional With-Profits Policies have final bonus rates set to achieve consistency with Recurrent Single Premiums Policies, allowing for Capital Distribution.
the Equitable’s Articles of Association making Utmost the sole member of the Equitable with effect from the Implementation Date, should the Scheme Policyholders vote in favour and the High Court approve the Scheme.">Change to the Articles will become effective; and
Proposal The Equitable’s Proposal to allocate its assets to its With-Profits Policyholders through the Scheme, the Change to the Articles, and the Transfer.
Second Court Hearing The High Court hearing of the Equitable’s application for an order that the Scheme and the Transfer be sanctioned, expected to take place on 22 November 2019 at the Royal Courts of Justice, 7 Rolls Buildings, Fetter Lane, London, EC4A 1NL, UK.
Voting Value The value of a Scheme Policyholders’s claim against the Equitable as at 1 April 2019, as indicated on the pre-printed voting form that Scheme Policyholders will receive in the summer.
With-Profits Fund The Equitable’s with-profits fund.
With-Profits Policy A policy which entitles its holder to participate in the Equitable’s profits and losses. Such policies include any Unit-Linked Policy to the extent that With-Profits Switching Rights were exercised under it on or before 31 December 2017 and its holder had an entitlement to participate in the Equitable’s profits and losses on that date.
Eine Zusammenfassung des Vorschlags
UPDATE 01. November 2019
Wenn der Vorschlag angenommen wird, werden deutsche überschussbeteiligte Verträge nach britischem Vorbild eine sofortige Erhöhung erhalten, die ihren fairen Anteil an den zu verteilenden Vermögenswerten darstellt (Anhebung) und alle Investmentgarantien behalten, aber nicht länger eine Kapitalzuteilung bei Inanspruchnahme von Leistungen erhalten.
Die Verträge werden in einen überschussbeteiligten Unterfonds der Equitable übertragen, die eine Tochtergesellschaft der Utmost wird.
Deutsche Verträge mit Überschussbeteiligung nach deutschem Vorbild würden die oben beschriebene Anhebung nicht erhalten.
Der Vorschlag zum Scheme und die Änderung der Satzung wurden bei der Sitzung der Versicherungsnehmer und der EGM zugestimmt und Einzelheiten hierzu befinden sich hier. Die Equitable wird nun das High Court bei der zweiten Gerichtsanhörung, beginnend am 22. November 2019, um die Genehmigung des Schemes und der Übertragung bitten. Falls das High Court diese Genehmigung erteilt, gehen wir davon aus, dass der Vorschlag am 1. Januar 2020 in Kraft tritt.
Sie finden eine ausführlichere Erklärung unseres Vorschlages in dem Packet, welches wir Ihnen im August zusandten.
Hier finden Sie eine Kopie der versandten Dokumente.
Schreiben an deutsche Versicherungsnehmer mit überschussbeteiligten Verträgen nach britischem Vorbild (stimmberechtigtes Mitglied)*
Schreiben an deutsche Versicherungsnehmer mit überschussbeteiligten Verträgen nach deutschem Vorbild (stimmberechtigtes Mitglied)*
* Es gibt andere Varianten für gewisse Vertragstypen. Bitte kontaktieren Sie uns, um diese anzufordern.
Informationsbroschüre Teil A
Informationsbroschüre Teil B
Das Scheme-Dokument
Rechtliche Bekanntmachung
Berichte der unabhängigen Experten
Zusammenfassung des Berichts des unabhängigen Expertens für Versicherungsnehmer
Zusammenfassung des Berichts des unabhängigen Expertens für die Übertragung
Das Principles and Practices of Financial Management (PPFM)
Die Equitable hat sich bemüht, sicherzustellen, dass der Inhalt der deutschen Übersetzungen so gut wie möglich mit dem Inhalt der relevanten englischsprachigen Dokumente übereinstimmt. Es kann jedoch zu Bedeutungsunterschieden zwischen den beiden Versionen eines Dokuments kommen. In diesem Fall sind die englischen Sprachfassungen aller Dokumente die maßgeblichen Fassungen.
Andere Dokumente zum Vorschlag, die in englischer Sprache abgefasst sind, finden Sie im Abschnitt „Supporting Documents“.
Falls Sie Fragen haben, rufen Sie uns bitte von Deutschland aus unter 01803 234630 an oder unter 0044 1296 384884, falls Sie von ausserhalb Deutschlands anrufen.
Forename in full *
Alternatively, if you would rather speak to us directly do call us on
Lines are open from 9am to 5pm on normal working days.
Calls to 03 numbers are charged at no more than a call to a standard 01 or 02 number.
Or other ways to contact us
0330 159 1530Calls charged at local rate when phoning from a UK land line
+44 1296 386242 Outside the UK
Securing your future together