We use cookies to improve site performance and enhance your user experience. If you'd like to disable cookies on this device, please see our cookie management page.
If you close this message or continue to use this site, you consent to our use of cookies on this devise in accordance with our cookie policy, unless you disable them.

In association with

Home > Training > Adviser Guides

Adviser Guides

Guide to With-Profits Investments

Published by FTAdviser | Aug 23, 2012

With-profits funds are a life company investment that offers growth, some life cover and possible cash bonuses in return for a customer’s lump sum payment.

These policies, which can be in the form of a fund, a bond or a pension, have been used to for long-term savings or retirement or to pay off a mortgage. Investors are assured of some protection from the vagaries in the stock market by a ‘smoothing’ process in the level of returns.

The possibility of a future lump sum in the form of an endowment or income is a key selling point for many customers.

Answers provided by Paul Fidell, senior investment business development manager at Prudential, and Kevin Arnott, with profits actuary at the Phoenix Group.

  1. What are with-profits investments?

    With-profits funds are a life company pooled investment where customers’ premiums are invested in a mix of equity, bonds, property and cash.

  2. What are the pros of with-profits?

    With-profits funds offer some unique qualities that will be very attractive for some clients and are usually sold as a safe haven product.

  3. What are the cons of with-profits products?

    There is a lack of transparency in how the bonus rates and investment mix are decided that will deter yet more customers.

  4. Who should invest in with-profits?

    With-profits will likely be most suitable for those with a longer-term investment horizon and relatively low risk appetite.

  5. How and when to exit with-profits funds

    There are no hard and fast rules and a number of factors need to be considered before deciding whether to exit a with-profits investment.

Finished reading this article? Bank 1hr Structured CPD below.

The CPD Tracker is only available to registered FTAdviser users

Q1.  How are with-profits funds defined?

*Please select an answer

Q2.  How many types of policies can be offered for with-profits?

*Please select an answer

Q3.  What have with-profits funds been criticised for?

*Please select an answer

Q4.  What is one of the main attractions of with-profits?

*Please select an answer

Q5.  How long should with-profits be held for?

*Please select an answer

Q6.  Can a with-profits annuity be cancelled?

*Please select an answer

You have answered all questions correctly. To bank your 1hr CPD minutes answer questions below.

These questions are required so that we can attribute against each piece of CPD learning an identified learning need that the content is meeting and a reflection statement on the learning undertaken. These are required elements for a piece of CPD to be considered as 'structured' under the new regime.

Why did you select this article as part of your CPD learning?

there's a limit of 500 characters

What have you learned from reading the article and completing the questions?

there's a limit of 500 characters


By submitting these answers I confirm that I have read and agreed to the terms and conditions.


Please add a brief statement in response to the above questions to bank CPD minutes.

By submitting these answers I confirm that I have read and agreed to the terms and conditions.

Most Popular
More on FTAdviser