2006
(02/10/2006) AXA announces with profits bonus rates
AXA has announced new with profits bonus rates for customers investing in the AXA Sun Life (ASL) With Profits Fund and the Sun Life Assurance Society (SLAS) With Profits Fund.
The good investment returns of the last two years have been consolidated in 2006. This, together with the financial strength of the ASL with profits fund, enables us to increase regular bonus rates by up to 0.75%. Payouts on many maturing policies are increasing by up to 6% as a result of this declaration. MVR rates have been reduced, increasing payouts on ASL bonds by up to 5%.
Commenting on the announcement, Peter Shelley, With Profits Actuary at AXA, said:
"The positive investment returns achieved in the last couple of years and the financial strength of the with profits fund are producing real improvements in payouts to our with profits customers. Long-term returns on maturing policies are good - around 7% pa on 20-25 year policies. Over the shorter term, with profits bonds have increased in value by 9% for 5-year bonds and 13% for 10-year bonds. These changes should give customers confidence in with profits as an appropriate investment option."
AXA With Profits Bonus Declaration 2006
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Regular bonus rates
New regular bonus rates on ASL's principal policy types are as follows:
AXA Sun Life (ASL)
Product Type From 28/2/2005 From 27/2/2006 From 2/10/2006 Mortgage Endowmenta 3.00% 3.00% 3.00% Bond 1.50% 1.75% 2.50% Personal Pension 1.50% 1.75% 2.50% New World (stakeholder) Pension 2.75% 3.50% 3.75% - The rate shown for Mortgage Endowments includes a guaranteed rate of 3%
Sun Life Assurance Society (SLAS)
There are no changes to the interim bonus rates for SLAS with profits policies.
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Payout Values
The following maturity payout examples show the position of policies in October 2006, immediately prior to and post this declaration.
ASL Endowment:
(Male aged 30, monthly premium of £50)
Type of Contract Maturity Value Prior Declaration Maturity Value Post Declaration Percentage Change Average Annual Growth Unitised mortgage endowment £23,396 (20-year term) £24,332 (20-year term) 4.0% 6.6% Unitised mortgage endowment £6,911 (10-year term) £7,212 (10-year term) 4.4% 3.7% ASL Personal Pension:
(Male aged 45, paying a monthly premium of £200)
Type of Contract Maturity Value Prior Declaration Maturity Value Post Declaration Percentage Change Average Annual Growth Unitised £103,119 (20-year term) £107,488 (20-year term) 4.2% 7.5% ASL Bond:
(Male aged 30, paying a single premium of £10,000)
Type of Contract Maturity Value Prior Declaration Maturity Value Post Declaration Percentage Change Average Annual Growth Unitised £14,227 (10-year term) £14,976 (10-year term) 5.3% 4.1% SLAS Endowment:
(Male aged 30, monthly premium of £50)
Type of Contract Maturity Value Prior Declaration Maturity Value Post Declaration Percentage Change Average Annual Growth Unitised mortgage endowment £23,666 (20-year term) £25,095 (20-year term) 6.0% 6.9% Unitised mortgage endowment £6,492 (10-year term) £6,644 (10-year term) 2.3% 2.0% SLAS Personal Pension:
(Male aged 45, paying a monthly premium of £200)
Type of Contract Maturity Value Prior Declaration Maturity Value Post Declaration Percentage Change Average Annual Growth Unitised £105,477 (20-year term) £105,477 (20-year term) 0.0% 7.3% SLAS Bond:
(Male aged 30, paying a single premium of £10,000)
Type of Contract Maturity Value Prior Declaration Maturity Value Post Declaration Percentage Change Average Annual Growth Unitised £16,172 (10-year term) £16,853 (10-year term) 4.2% 5.4% -
Market Value Reductions
Market Value Reductions (MVRs) have been reduced by between 2% and 5%. No MVRs have been increased. This has been made possible by the asset performance of the with profits funds over the year. MVRs are applied in certain circumstances, such as when a customer chooses to exit the fund outside their maturity date. MVRs are applied to ensure that all customers receive a fair share of the fund's asset performance, whether they are staying in the fund or exiting it. MVRs do not apply at life maturities, on death, or on any conventional with profits policies.
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Asset Mix
The overall asset mix of AXA's with profits funds has been as follows:
ASL Fund:
Class % at end 2005 % at mid 2006 Equities 44% 43% Property 16% 18% Fixed Interest 38% 39% Cash 2% 0% SLAS Fund:
Class % at end 2005 % at mid 2006 Equities 42% 42% Property 10% 11% Fixed Interest 45% 47% Cash 3% 0% All asset mix figures are approximate, and vary by policy type.
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With Profits Fund Size
The size of the ASL with profits fund is £10bn. The size of the SLAS with profits fund is £6.5bn. These figures were correct as at December 2005.
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About AXA
AXA UK is part of AXA Group. AXA Group is a worldwide leader in Financial Protection. AXA's operations are diverse geographically, with major operations in Western Europe, North America and the Asia/Pacific area. AXA had € 1,091 billion in assets under management as of June 30, 2006, and reported total revenues of € 41 billion and underlying earnings of € 2,090 million for the first half of 2006.
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