2007
(05/03/2007) AXA announces improved with profits bonus rates and removes all MVRs
AXA has announced improved with profits bonus rates for many of the 1.3 million customers investing in the AXA Sun Life (ASL) With Profits Fund and the Sun Life Assurance Society (SLAS) With Profits Fund.
Regular bonus rates have increased by up to 1.5% compared to the same time last year, and with profits bonds have increased in value by up to 16% over the same period. Market value reductions (MVRs) have been removed on all products.
The increases follow continued improvements in investment returns, which saw the ASL With Profits Fund produce an 11% investment return during 2006, while the SLAS With Profits Fund produced a 10% return. Terminal bonuses have also improved resulting in an average 4% increase in overall payouts over the last year.
In addition, in view of the financial strength of the ASL Old With Profits Fund, a special bonus is being declared on policies invested in that fund. The bonuses are approximately 4.0% for unitised policies and 2.5% for conventional policies.
With profits actuary Peter Shelley said: "The improvement in investment returns is now feeding through into higher rates of regular and terminal bonuses, continuing the trend that saw us increase rates twice during 2006. This is good news for with profits policyholders, who are now seeing further improvements in the payouts on their policies. The fund remains strong and is well placed to turn good stock market performance into further improvements in payouts."
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Notes to Editors
The value of investments can go down as well as up and is not guaranteed. Investors could get back less than they invest.
Future bonuses can not be guaranteed as they come from profits that have not yet been earned. Bonus rates are regularly reviewed and may change at any time.
If the investment performance of the with profits fund is lower than that reflected in bonuses already added, we may apply a Market Value Reduction in the future.
Past performance is not a guide to the future.
Regular bonus rates
New regular bonus rates on AXA's principal policy types are as follows:
AXA Sun Life (ASL)
Product type From 27/02/2006 From 2/10/2006 From 5/3/2007 Mortgage Endowment1 3.00% 3.00% 3.50% Bond 1.75% 2.50% 3.25% Personal Pension 1.75% 2.50% 3.00% New World (stakeholder) Pension 3.50% 3.75% 4.00% 1 The rate shown for Mortgage Endowments includes a guaranteed interest rate of 3%
Sun Life Assurance Society (SLAS)
Product type 1/1/2005 - 31/12/2005 1/1/2006 - 31/12/20062 Interim from 1/1/2007 Mortgage Endowment 1.75% 2.25% 3.00% Bond 1.75% 2.25% 3.00% Personal Pension 2.25% 3.00% 3.75% 2 The regular bonus rates declared today is retrospective and apply for the past year from 1/1/2006 to 31/12/2006.
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Payout Values
The following payout examples show the position of bonds in March 2007 immediately following this declaration, compared to their values one year earlier. For pension and endowment policies, the following maturity payout examples show the position of policies maturing in March 2007, immediately following this declaration, compared to those maturing one year previously. All ages quoted are at commencement of the policy.
ASL Bond:
(Male aged 30, paying a single premium of £10,000)
Type of Contract Value March 2006 Value Post Declaration March 2007 Return over final year Average annual growth Unitised - 5 year £10,446 £11,299 8.2% 2.5% Unitised - 10 year £13,641 £15,376 12.7% 4.4% Unitised - 15 year £22,140 £25,657 15.9% 6.5% ASL Endowment:
(Male aged 30, monthly premium of £50)
Type of Contract Maturity Value March 2006 Maturity Value Post Declaration March 2007 Percentage change Average annual growth Unitised mortgage endowment (20 year) £24,034 £24,702 2.8% 6.7% Conventional mortgage endowment (25 year) £39,255 £41,305 5.2% 7.3% ASL Personal Pension:
(Male aged 45, paying a monthly premium of £200)
Type of Contract Maturity Value March 2006 Maturity Value Post Declaration March 2007 Percentage change Average annual growth Unitised (20 year) £105,728 £105,536 -0.2% 7.3% SLAS Bond:
(Male aged 30, paying a single premium of £10,000)
Type of Contract Value March 2006 Value Post Declaration March 2007 Return over final year Average annual growth Unitised - 10 year £14,381 £15,199 5.7% 4.3% Unitised - 15 year £23,326 £25,965 11.3% 6.6% SLAS Endowment:
(Male aged 30, monthly premium of £50)
Type of Contract Maturity Value March 2006 Maturity Value Post Declaration March 2007 Percentage change Average annual growth Unitised mortgage endowment (20 year) £24,450 £27,238 11.4% 7.6% Conventional mortgage endowment (25 year) £41,645 £41,462 -0.4% 7.4% SLAS Personal Pension:
(Male aged 45, paying a monthly premium of £200)
Type of Contract Maturity Value March 2006 Maturity Value Post Declaration March 2007 Percentage change Average annual growth Unitised (20 year) £109,973 £112,654 2.4% 7.9% -
The Special Bonus declared on the Old With Profits Fund of AXA Sun Life is payable to those policyholders who retained a right to any distribution of surplus assets following AXA's reattribution of the inherited estate in December 2000.
During 2000, customers in the AXA Equity & Law and AXA Sun Life with profits funds were given the opportunity of accepting a cash payment and giving up the right to any distribution of surplus assets in the future (and transferring to the New With Profits Fund by doing so), or retaining their rights to a future distribution but foregoing the cash payment (and remaining in the Old With Profits Fund by doing so). Customers who chose not to receive the cash payment in 2000 will now benefit from the payment of a special bonus provided they remained invested in the Old With Profits Fund until at least 31.12.2005.
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Asset Mix
The asset mix of investments backing AXA's with profits policies has been as follows:
ASL Fund:
Class % at mid 2006 % at end 2006 Equities 43% 54% Property 18% 16% Fixed Interest 39% 27% Cash and Other 0% 3% SLAS Fund:
Class % at mid 2006 % at end 2006 Equities 42% 37% Property 11% 13% Fixed Interest 41% 44% Cash and Other 6% 6% 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 £9.7bn. The size of the SLAS with profits fund is £6.8bn. These figures were correct as at December 2006.
More information
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About AXA
AXA UK is a part of the 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. For full year 2006, IFRS revenues amounted to €79 billion and IFRS underlying earnings amounted to €4,010 million.
The AXA ordinary share is listed and trades under the symbol AXA on the Paris Stock Exchange. The AXA American Depository Share is also listed on the NYSE under the ticker symbol AXA.
Our previous company performance is not a guide to how we may perform in the future.