Legal & General’s now closed with-profits funds have returned 9.6 per cent before tax last year, although the value of bonuses added fell.
The company added bonuses worth £387m to policies last year, down from £490m in 2013, which it said reflected a fall in mortgage endowment policies maturing in 2014 - 29,000 compared to 45,000 in 2013).
Over 25 years the assets held on behalf of with-profits policyholders have returned 8.1 per cent per annum before tax and over 10 years the annual return is 7 per cent before tax.
Jackie Noakes, managing director mature savings at Legal & General Assurance Society said the figures demonstrate the benefits for existing customers remaining invested with a with-profits provider, operating active management of a balanced asset mix.
Following the closure of the fund on 31 January - as a direct result of a continued fall in new investments since the RDR came into force two years ago, the firm said - future bonuses may include a distribution of the inherited estate. No distribution was made as part of this declaration.
FTAdviser reported that just 14 providers remain open to new with-profits business, with three of these firms set to consolidate business with bigger partners.
For customers whose endowment mortgages are not yet at maturity, regular bonus rates are being maintained.
peter.walker@ft.com
