The new charging structures reflect demand from intermediaries for greater flexibility, both in terms of the shape of product offered to clients and the remuneration options available to the adviser. The tiered option is designed for clients who either like the freedom provided by no early encashment charges, or who want to spread the cost of any initial commission over the first three years of the investment. It will be particularly attractive to self invested personal pension investors looking to broaden the range of their investment choices, particularly for cash deposits.
An ongoing charge is taken quarterly for the life of the investment, the size of the charge depending on the investment amount. This option gives clients the simplicity of a level bond fee and no early encashment charges where no initial commission is taken. A bond charge is taken for the first five years of the bond, with an early encashment penalty during those five years equivalent to the outstanding bond charges, and there is also a GBP107.50 quarterly charge reviewable annually in line with inflation.
Rod Macdonald, marketing manager for life products business at Clerical Medical, said: The introduction of these two new charging structures by Clerical Medical is a response to the continuing strong demand from intermediaries for offshore investments.
This move is about offering intermediaries more choice, enabling them to fit our product to a wider range of circumstances, so they will be better placed to tailor the product charges to suit both a greater number of clients and their own business model.
