The re-launched direct seller, which is owned by Axa, has spent £250m re-launching its 200-year-old brand.
The first product to be launched is a stocks and shares Isa, which has a minimum monthly premium of £10.
On the 10th anniversary, and every five years after that, investors are guaranteed to receive a minimum of the amount invested, provided they have not made any withdrawals
There are no penalty charges for withdrawals; however, on dates other than guarantee dates, there is always the possibility that customers may get less than they pay in.
Charges and expenses are currently 1.5 per cent of the value of the new Isa each year – at £10 a month, this should amount to £1.80 in the first year
Dean Lamble, managing director at SunLife, said the Isa is just the first in a series of straightforward, affordable new products it intends to launch to address the needs of younger customers and families.
“Research by SunLife reveals that 39 per cent of the mass market currently have no savings at all and 24 per cent of those who do have less than £1,000. So identifying the need for straightforward, affordable investments that also provide an element of protection.
“Unlike many other stocks and shares Isas, which require a much higher investment amount, giving consumers the opportunity to save from £10 a month means that Isas will now be much more accessible.”
SunLife said it is exploring products that give customers the potential to beat the returns available from deposit accounts, with benefits such as low monthly payments and the flexibility to top up, stop or change payments without penalty.
Mr Lamble said: “There’s an opportunity for the direct-to-consumer market in UK fin-ancial services to grow. But it requires customer under-stand-ing and engagement, as well as products, processes and servicing for the direct model. Our approach will em-power customers with clear inform-ation and enable them to self-direct without explicit advice.”
Other future offerings include critical illness cover from £20 a month, as well as term life insurance.
The company, which has ditched the ‘direct’ label from its title, said it would also be refreshing its over-50s funeral plan offer to include wills and other later life offerings.
REACTIONS
PROVIDER VIEW
Dean Lamble (below), MD at SunLife, said: “More customers want the opportunity to be able to invest in products that can beat the poor returns they are getting from holding cash in bank accounts, and to encourage longer-term saving, at 10 years, investors are guaranteed to receive at least what they’ve paid in.”
ADVISER VIEW
Bob Wilson, an IFA with Greensky Wealth in Norwich, said: “As long as people understand the risk of investing in the stock market, then I can see no problem with this.
“It could be that the product range might even end up introducing more people to the benefits of investment, at which point they may well want to seek professional financial advice.”
CHARGES
Charges and expenses are currently 1.5 per cent of the value of the new Isa each year.
VERDICT
It is always good to see new competition enter the space in what is an exciting time for stocks and shares Isas. At this stage it will be interesting to see how many funds will be made available to savers, and the full extent of charges when both buying and selling funds.
