Pru with-profits fund loses 19.7%
Prudential has announced that its with-profits fund lost 19.7% of its pre-tax value during 2008, as a result of exceptional market conditions.
For individual investors up to 10% has been wiped off the value of their savings.
Annual bonus rates have been set at 3% for most with-profits bond and 2% for personal pension policies. Annual bonuses on endowment policies are unchanged.
The firm’s chief actuary, David Belsham, comments: “Although investment markets have performed very poorly in 2008, our policyholders have been protected from the full impact of the market falls and will typically see a reduction of 6% and 10% in their accumulating with-profits policy values”.
Mr Belsham believes this “compares very well with many directly exposed investment options available to customers”.
Prudential says its with-profits fund is supported by an inherited estate of £5.4 billion and has delivered investment returns of 67.2% over 10 years compared with the FTSE All-Share index (total return) of 12.4% over the same period.
In related news, the company recently reported that worldwide sales had increased during 2008, with overall group insurance new business up 5%.
In addition its capital cushion stands at a reassuring £1.7 billion.
Category: Financials, Insurance News, Prudential Insurance News
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