The Skandia Plan

The Skandia Plan is a unit-linked whole life insurance policy, which provides the protection of a cash sum on death, and combines life cover with investment benefits.

A cash sum is paid when you die or, if you have selected Total Disability benefit, if you become permanently and totally disabled and are unable to work again.

The premiums you pay are put into investment funds of your choice. Some money is taken out of the funds each month to pay for the protection. If the funds you invest in perform better than expected, your fund can grow beyond the amount needed to provide the protection. If they don’t, you may have to increase your premiums to keep the same level of cover (see Minimum cover limit).

The Skandia Plan benefits from Skandia's MultiManager approach to investment and gives you access to over 400 funds.

Benefits

The Skandia Plan gives protection for you and your family, while giving your contributions the opportunity to grow.

The Skandia Plan can also be suitable for use as part of your provisions to pay any inheritance tax which may be due when you die.

It will pay a lump sum on your death.

The Skandia Plan includes flexibility to vary the levels of protection and investment to suit your lifestyle needs. For example, you may wish to have high levels of protection when your family is young and then, when approaching retirement, use your premiums to maximise the growth of your fund.

It also allows you to change your cover as your lifestyle changes, without the need for further medical evidence.

You can reduce or increase your cover at any anniversary of the start date of your plan. Increases may require further medical evidence.

The Skandia Plan gives you access to an extensive range of funds with a wide choice of investment objectives, so you can tailor your investment portfolio to suit your needs.

You can extend your cover by adding the following benefits to your plan at an extra cost:

• total permanent disability benefit

• waiver of premium benefit.

The Skandia Plan can cover only you, or you and your partner in one joint life policy.

Tax efficiency – when the life cover benefit is paid on death, it is normally free of all personal liability to income and capital gains tax. If you have written the death benefit in trust, you can ensure that the proceeds are free from the burden of inheritance tax as well.

Risks

If you cash in the plan you may get little or nothing back.

If you stop making regular payments your life cover will stop once the value of your plan is zero.

After ten years, you may need to increase payments to make sure your cover lasts for as long as you need it.

The value of units can go down as well as up and any growth cannot be guaranteed.

Who is eligible to take out The Skandia Plan?

UK residents.

Minimum and maximum ages

Applicants have to be age 18 or over.

The life assured must be aged between 18 and 80 inclusive at the start of the plan.

There is no maximum age at the end of the plan.

Minimum premiums

£20 a month or £200 a year.

Minimum cover limit

The minimum sum assured is 75% of all premiums paid from the start of the plan to the 75th birthday of the person or people insured.

The other types of cover, based on the premium you pay, are:

Standard cover – this cover is calculated to last throughout your life assuming the value of your chosen funds grows at 6% each year. The calculation takes into account certain plan charges. If your fund choice does not achieve the assumed growth rate, you may have to increase your premiums in the future. We will tell you if this is the case.

Maximum cover – this cover is calculated to last for ten years taking into account the benefits you choose, your premium level, your age and your health. At the end of the ten-year period we will tell you how much you will need to pay to keep your cover at the same level.

Term

The insurance cover lasts for the whole of your life.

Guarantees

We guarantee your cover for ten years from the start of your plan, if you keep paying your premiums for the cover you originally selected.

Charges

We will deduct charges from your investment fund each month for the protection benefits, plan administration and fund management.

This web page is only intended as a general introduction to The Skandia Plan. Full details of the product can be found in The Skandia Plan brochure, available from your financial adviser.

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Information on this website is not intended for Hong Kong residents. Information on this website about Skandia Group Companies is intended for UK residents only, unless it relates to Royal Skandia, Skandia Life Norge or Suomen Sivuliike. Skandia Group companies do not offer investment advice and no information on this website should be construed as such.

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