FOR FINANCIAL ADVISERS ONLY

Further changes for existing customers with the launch of Wealth Interactive


FOR FINANCIAL ADVISERS ONLY
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Further changes for existing customers with the launch of Wealth Interactive

The move to the Wealth Interactive administration system has given us the opportunity to update certain aspects of your Portfolio Bond policy. We have sent all our clients correspondence together with an Online Service endorsement to your Policy Terms that explains these changes in detail. 

There are some details that we need you to pay particular attention to, so please take a few moments to read on as you may need to take some action.

The main changes affect your Transaction Account, which is the part of your Policy from which charges, fees and withdrawals are paid:

 

  • We have issued the abovementioned endorsement to clarify the way your Transaction Account operates and how you can manage the charges and any Fund Adviser Fees, including Ongoing Service Fees and Dealing Advice Fees (if applicable) or withdrawals that are paid from your policy.  
  • From the launch of Wealth Interactive, you must choose a Nominated Asset to pay withdrawals. If a Nominated Asset is not chosen the withdrawal will not be paid.
  • In order to continue to pay fees from the policy a Charge Deduction Asset must be chosen. If you do not choose a Charge Deduction Asset we will use the Transaction Account, if there is sufficient cash value. If the Transaction Account does not have sufficient value, the fees will not be paid.

Further information about this change is contained in points 1 and 2 below. If there are not enough funds to cover Old Mutual International’s charges, we will still deduct these charges and your Transaction Account will become temporarily overdrawn. Further information about this change is contained in point 3 below.

IMPORTANT INFORMATION

To help ensure continuity of withdrawal and fee payments after your Policy is moved onto Wealth Interactive, Old Mutual International will adopt a one-off process to automatically apply a ‘Nominated Asset’ and/or ‘Charge Deduction Asset’ where you have not selected one.

Full details can be found below in section 1 and 2.

KEY POINTS TO NOTE:

Once your Policy is moved onto the Wealth Interactive system, it’s your responsibility to make sure that there is enough money readily available to meet the charges that apply to your Policy and any withdrawals or fees. These are treated slightly differently, as explained below:

1) How to ensure you have enough money to cover withdrawals

If you are taking regular withdrawals from your bond, you must nominate an asset from which the withdrawals will be taken (this will be called a ‘Nominated Asset’). You can instruct us to use the Transaction Account as the Nominated Asset.

Your ‘Nominated Asset’ must be received by 15 October 2014. If we have not received your response by this date then when your Policy is moved onto the Wealth Interactive system, as a one-off process to help ensure withdrawals continue, we will automatically use the highest value liquid asset as at 30 September 2014 which is still available to use as the ‘Nominated Asset,’ irrespective of whether this would result in disproportionate costs of sale. If you do have sufficient cash in your transaction account to cover 6 months of regular withdrawals, we will select the transaction account as the ‘Nominated Asset’ before we use the highest value liquid asset as the Nominated Asset

An Investment Dealing Charge will apply to the sale of any assets.

If in future your Nominated Asset has insufficient value to cover the withdrawal, or there’s not enough credit balance in your Transaction Account (where this is the Nominated Asset), your withdrawals will stop.

We will reinstate them as soon as you provide details of a new Nominated Asset to us, or there is enough money in the Transaction Account to cover the withdrawal, where this is the Nominated Asset. You can ask for missed payments to be paid when you select a new Nominated Asset.

Please note that any existing overdraft on the transaction account will not be impacted by the sale of the Nominated Asset to fund withdrawals.

The above provisions do not apply to your Policy where an Authorised Custodian has been appointed. This process is explained in the flowchart below:

2) How to ensure you have enough money to cover fund adviser/investment adviser representative fees

If you pay fees to a fund adviser/investment adviser representative, this is classed as a withdrawal from your policy. You can select which asset the withdrawal is made from (this is called a ‘Charge Deduction Asset’). The Transaction Account cannot be selected as a Charge Deduction Asset for payment of fees. Therefore, if you want to use the credit balance in the Transaction Account for the payment of fees, you should not select a Charge Deduction Asset.

Your Charge Deduction Asset request must be received by 15 October 2014. If we have not received your response by this date, when your Policy is moved onto the Wealth Interactive system, as a one-off process to help ensure fees continue to be paid we will automatically use the Transaction Account where there is enough credit balance to cover 6 months of fees and charges. If, however, there is not enough credit balance in the Transaction Account we will automatically use the highest value liquid asset as at 30 September 2014 which is still available to use as the Charge Deduction Asset. This could result in a disproportionate cost of sale.

For future payment of the fees we will continue to use your selected Charge Deduction Asset (including the highest value liquid asset where we have previously selected this as the Charge Deduction Asset) or the credit balance in the Transaction Account where you have not selected a Charge Deduction Asset, unless you send a request to change the Charge Deduction Asset.

If there is not enough value in Charge Deduction Asset to pay the fee, the fee will not be paid. Where a Charge Deduction Asset has not been selected and there is not enough credit balance in the Transaction Account to cover the fee, the fee will not be paid.

An Investment Dealing Charge will apply to the sale of assets.

Where you have appointed a Fund Adviser, it is your responsibility to inform the Fund Adviser of these changes, to ensure that your Fund Adviser acts in accordance with them. Where the Fund Adviser is also your Financial Adviser noted on our records we have already sent them a copy of this document.

Please note, if a Charge Deduction Asset is chosen to fund fees, any accrued overdraft on the transaction account will be cleared when the Charge Deduction Asset is sold to cover fees.

The above provisions do not apply to your Policy where an Authorised Custodian has been appointed. This process is explained in the flowchart below:

3) How to ensure you have enough money to cover charges

You will need to monitor your Transaction Account to ensure there is sufficient credit balance in the Transaction Account to cover our quarterly charges. You will also need to choose an asset that will be used to cover our quarterly charges, which will be used in the event where there is insufficient credit in the Transaction Account. This asset is called the ‘Charge Deduction Asset’.

If there is not enough cash in your Transaction Account or Charge Deduction Asset to cover our charges, we will still deduct the charges and you will be temporarily overdrawn. If this happens, we will inform you in your next quarterly valuation. If your Transaction Account remains overdrawn for more than 30 days we have the right to sell assets from your Policy to clear the overdraft as set out in the Policy Terms and Conditions. Please refer to your Policy Terms and Conditions if you require further information.

This process is explained in the flowchart below:

HOW DO YOU CHOOSE A CHARGE DEDUCTION ASSET OR A NOMINATED ASSET?

You can choose a charge deduction asset or a nominated asset by downloading and completing the ‘Asset Nomination Form’. Download the Asset Nomination form

This form can be sent by post or scanned and emailed to the following Customer Contact mailbox: customercontact@ominternational.com. We recommend that you speak to your financial adviser before selecting an asset.

DIVIDENDS FROM INCOME SHARE CLASSES

Currently, if you invest in an income share class, we reinvest any dividends into units, unless you specifically request cash to be paid into your Transaction Account. Once your Portfolio Bond is transferred onto Wealth Interactive, any dividends on income share classes will automatically be paid into your Transaction Account. This will help ensure that there are sufficient funds to pay any charges or fund adviser fees or investment adviser representative fees.