Wesleyan has become the latest provider to continue to slash bonus rates on its 'with profits' fund despite strong market growth over the last year. Cuts in bonus rates across the board see cuts in overall payouts between 3% and 6% for life policies and up to 6% to 15% for some pensions.
Our view
Just because we have had one good year this year on investment returns, the reserves of insurance companies have been hard hit over the last few years where they have had to dig deep in reserves to declare bonuses when real returns have been negative.