Norwich Union is considering a 'make-over' for their with-profits products after a poll revealed that 91% of independent financial advisers do not actively recommend with-profits policies to their clients.
The company are to emphasise the smoothing features of the investment and break away from the negative image they have received in the past few years, and place less emphasis on headlining it as with-profits.
Our view
Norwich Union's 'with profits' funds have actually done very well over the last few years. The problem is not the 'with profits' fund itself, it is the way they are sold by poor advisers. They have been sold as an alternative to cash deposits with 'low risk' returns.
The reality is the returns are linked to the stockmarket and in difficult times, surrender penalties known as 'market value adjustments' (MVA's) are applied such as now.