With-profits

If we look after a life insurance or pension policy for you, and it was issued in the UK or Ireland, then some of your money might be invested in the SLOC With-Profits Fund (“Fund”).

If you’re not sure whether your money is invested in the Fund, ask us.

What is a with-profits plan?

A with-profits fund is a kind of investment fund. Like most kinds of investment funds, it works by pooling together lots of people’s money to invest in a range of assets, such as shares, bonds, property and cash. 

Unlike other kinds of investment funds, a ‘with-profits’ fund aims to ‘smooth’ the short-term ups and downs of investing, while still delivering growth in the long term.

How does the Fund work?

In any year, the assets in the Fund might perform well or they might perform badly. If they perform well, the Fund’s profits will go up. If they perform badly, the Fund’s profits will go down.

Most kinds of investment funds expose you to ups and downs. Depending on when you take your money out, you could get more than you put in but you could also get less.

The Fund aims to protect you from these short-term ups and downs. It does this by holding back and reinvesting some of the profits from the ‘up’ years to smooth out any losses in the ‘down’ years.

You will  get your share of the profits as a bonus. We usually add a small bonus to your plan every year – this is called an annual or ‘reversionary’ bonus.  It increases the amount we will pay when your plan ends on maturity or death. Once we have added your bonus, it is guaranteed and it cannot be taken away. When your plan ends, you will normally also get another bonus – this is called a final or ‘terminal’ bonus and ensures that you get your fair share of the Fund. The amount you get will depend on how the Fund has performed during the time you have been invested and the expected future Fund performance. It also reflects the effect of smoothing investment returns and the cost of running the Fund.

This means that, if the Fund has performed badly for several years, you could get a small final bonus or no final bonus at all. Similarly, if the Fund has performed well for several years you could get a bigger final bonus.

Loan interest rates

The following current loan interest rates and Automatic Premium Facility charges apply for eligible with-profit plans:

Sun Life Financial of Canada

Plan issue date fromPlan issue date toInterest typeInterest rate
1 December 1971CurrentVariable5%
1 April 196830 November 1971Fixed7%
1 January 195731 March 1968Fixed6%
1 January 194931 December 1956Fixed5%

With-Profits Committee Terms of Reference Adobe PDF document

Policies in the SLOC With-Profits Fund were sold by Sun Life Financial of Canada before 2001. Policy numbers begin with LA, LI or LM followed by 4 or 8.

If you are unsure whether your policy is invested in this fund, please check your Annual Statement or contact us with your policy number to hand – we will be happy to help.

Bonus Notice

The bonus notice tells endowment and whole-life customers how we set bonus rates each year. We also include this information in customers’ annual statements.

Directors’ Report

The Directors’ Report explains how we have managed the fund in the past year and includes an independent report from the With-Profits Actuary.

Principles and Practices of Financial Management (PPFM)

The PPFM of a with-profits fund explains in detail how we manage the fund and how with-profits policies work.

Former With-Profits Funds

SLFC Assurance UK With-Profits Fund

Before September 2009, this fund was known as the Lincoln With-Profits Fund. Policy numbers begin with 5.

On 1 February 2017 SLFC Assurance UK With-Profits Policies were converted to Non-Profit Policies by way of a Scheme of Arrangement under the Companies Act 2006.

We wrote to customers in March 2017 to provide an endorsement to policy terms & conditions and a statement to show the value of their Non-Profit Policy and the future guaranteed increases the policy will receive going forward.

We continue to send customers a statement every year so that they can keep track of their policy value and benefits.

Confederation Life With-Profits Fund

These policies were sold by Confederation Life before Sun Life Financial of Canada bought Confederation Life in 1995. Policy numbers begin with LL.

On 31 March 2015 Confederation Life With-Profits Policies were converted to Non-Profit Policies. We wrote to customers in December 2014 to explain this change and provide advance notice.

We wrote to customers again in June 2015 to provide an endorsement to their policy terms & conditions. We included a statement to show the value of their Non-Profit Policy and the future guaranteed increases the policy will receive going forward.

We continue to send customers a statement every year so that they can keep track of their policy value and benefits.

Cannon Pension Fund Deposit Account

On 31 October 2014 Cannon Pension Fund Deposit Account Policies were converted to Unit-Linked Policies by way of a Scheme of Arrangement under the Companies Act 2006.

We wrote to customers in November 2014 to provide the new policy terms & conditions. We included a statement to show the value of their Unit-Linked Policy, which has the potential to increase in value if the unit prices go up but will also decrease in value if the unit prices go down.

We continue to send customers a statement every year so that they can keep track of their policy value and benefits.

Unsure which fund you have?

If you are unsure which fund you have, please check your Annual Statement or contact us with your policy number to hand – we will be happy to help.