Axa Investment Bond

The AXA Investment Bond* is a life assurance-based product. In February 2008, it was awarded a Defaqto** 5 Star Rating, the highest rating given by this independent financial research company.

The Investment Bond could be suitable for those who:

• want to invest lump sums of £5,000 or more
• are considering investing their money for the medium
  (at least 5 years) to long term (over 10 years).

The Investment Bond is not suitable for customers who might like access to their money at short notice.

With the Investment Bond, your client can choose from a range of funds which can be combined to match investment aims and attitude to risk. However, it is important that they know that the value of their investment can fall as well as rise and is not guaranteed. There is a risk that they may not get back the original amount invested, especially if they cash in the bond in the early years.

A range of options

Every client’s needs are different so we’ve made our Investment Bond flexible, with options and features so you can adapt it to their personal situation:

Flexible pricing options

We offer customers a choice of three different pricing structures with their Investment Bond, designed to meet their individual needs. Different charges apply to each and the yearly management charges can vary, depending on the funds your clients choose. Log in to our AXA Adviser Extranet for more information on our pricing options, or see the ‘Investment Bond Guide’. Please note that the charges are taken to pay for fund management and policy administration. These charges can vary at any time in line with terms and conditions and reduce the potential for growth and/or income.

Extensive fund range

With over 250 funds to choose from, there is plenty of choice when selecting the right mix of funds to suit your client’s investment aims. The range has recently been further extended to ensure we offer a broad mix of asset classes and fund charges vary depending on the fund selected.

Providing additional tax efficient income

The Investment Bond can be used to grow your client’s money and provide them with regular income. They can take 5% of the initial investment each year for up to 20 years. Tax on these income withdrawals is deferred until the encashment of the bond and the amount of tax they pay will depend on their tax band at this time. Your clients could withdraw up to 7.5% of the value of their investment each year but anything over the 5% may be subject to immediate taxation.

Your clients should also be aware that anything over 7.5% is classed as a cash in and may attract further charges. Obviously, taking such an income can reduce the potential for capital growth and could cause the value of the bond to fall below the original investment amount.

Fund switches free of any additional charges

We know that people’s investment needs and attitude to risk can change over time. So with the Investment Bond, we offer the flexibility to switch funds at any time. There is currently no additional switch charge, but we reserve the right to introduce one in the future in line with terms and conditions. In some circumstances, we may need to delay a request to switch funds by one month, or by six months for property funds.

Additional investments

Clients can make extra payments of £500 or more at any time, so it is great for people who like the flexibility to invest more when it suits them. Additional Investments will be treated as if a new bond had been taken out for charging purposes. Just like the original capital invested, these additional payments can rise and fall in value and are not guaranteed, so your clients may get back less than they invested.

Want to know more?

For more details and further information about how our Investment Bond could help your clients, please log in to our dedicated AXA Adviser Extranet or talk to your Business Development Manager. You could also take a look at our product key features and special risks and charges guides which are available on request.

*the Investment Bond information relates to the AXA Investment Bond sold through Independent Financial Advisers. Investment products sold through other third parties or tied agents may differ from the details described here.

**Defaqto is an independant financial research company that rates products for quality. While we strive to achieve further accolades there is no guarantee we will gain similar awards in the future.