No fat for Mr Cat

We have a health conscious diet of no bid/offer spreads, but how much cream are other providers consuming?

RL360° Funds For financial advisers only

At RL360° we love to make life simple for advisers. It’s not always an easy task, but with the Quantum, Paragon, Oracle and LifePlan fund range we believe we have.

When advisers ask us the question “How much fat is in your spread?” our simple response is zero percent.

And that’s backed up by a fund range that includes:

NO mirror funds NO custodian fees

NO switching or redirection fees

NO initial charges or bid/offer spreads

Just a direct fund range can that can be switched online by investment advisers and clients alike.

However, have you asked other providers to clarify their position?

If not, here are 3 good questions to ask:

1. Is each of my client’s premiums subject to a potential bid/offer spread?

If the answer is yes and your client has a regular premium policy with a provider that charges 0.5% on entry to each of the funds they have selected then:

PremiumsUSD 1,000 per month

Term15 years

Bid/offer spread deductionsUSD 900

At RL360° these charges do not apply.

RL360° Funds

The healthy option for advisers?

2. Do each of my clients get charged a bid/offer spread when switching from their existing funds into a new fund?

If the answer is yes, and your client switches out of their existing funds and into new funds which have a 0.5% charge on entry then:

Switch outFund A

Value outUSD 71,598

Switch inFund B

Value inUSD 71,240

Bid/offer spread deductionsUSD 357.99

These figures assume a USD1,000 per month premium, growing at 7% a year net of charges, with the switch taking place at the end of the 5th policy year.

Again with RL360° there are no such worries; all transactions are conducted on a bid-bid basis.

If the answer to any of these questions is yes, then your clients could be paying significantly more in fees for accessing funds that they wouldn’t through an RL360° policy.

We’re sure that this will leave your clients feeling less like purring and more like they’ve choked on a hair ball!

Clearly some providers may apply charges in some instances but not in others and equally some may follow us and not apply charges under any of these circumstances. But whatever the answers at least you know that with RL360° the answer is simple.

3. Are each of my clients charged the bid/offer spread even if they are only rebalancing?

If the answer is yes, and you client rebalances 50% of their portfolio each year throughout the term then:

Rebalancing frequencyYearly

Premium and termUSD 1,000 per month 15 years

Bid/offer spread deductionsUSD 5,213

These figures assume growth of 7% a year net of charges, with rebalances taking place at the end of each policy year. In this case these deductions amount to 2.9% of total premiums paid over the term.

But again with RL360° we don’t apply these charges, so you can switch, redirect, rebalance and take advantage of opportunities for growth as often as you decide.

We have produced a separate calculator so that you can try different combinations of answers, premium amounts, terms and spread costs to assess what the impact could be for your clients.

Contact your local sales manager for details.

This document only focuses on one aspect of a product’s potential charging structure, and before making any recommendations to your client you should review and consider all aspects of a product’s charging structure.

Important notes:

For financial advisers only. Not to be distributed or relied on by retail clients.

Find out more today

Speak to your local sales manager and find out how we can help.

For more information visit: www.rl360adviser.com/funds

Issued by RL360 Insurance Company Limited.

Registered Office: RL360 House, Cooil Road, Douglas, Isle of Man, IM2 2SP, British Isles.

Telephone: +44 (0)1624 681681. Telephone calls may be recorded.

Website: www.rl360.com

RL360 Insurance Company Limited is authorised by the Isle of Man Government Insurance and Pensions Authority. Registered in the Isle of Man number 053002C. A member of the Association of International Life Offices.

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RL360° Funds