Legal & General announces closure of With Profits Fund

Legal & General has announced it will close its With Profits Fund to new business with effect from 31 January 2015.

There will be no change to how the With Profits Fund is managed as a result of this closure and we will continue to allow investments for existing policyholders and schemes*.

The fund is invested in a range of assets, including UK and overseas equities, fixed interest and commercial property. It aims to maximise returns for its members subject to an appropriate degree of investment risk.

Jackie Noakes, Managing Director, Mature Savings said; “We have seen a continued fall in investments into our With Profits Fund, especially since the inception of the Retail Distribution Review.

As these new business levels can no longer be defined as substantial, we have taken the decision to change the regulatory status of our fund to ‘closed’ in accordance with the Conduct of Business Sourcebook.

We will continue to deliver active investment management in the best interests of our with profits customers as you would expect from a leading with profits provider.

By actively investing in a broad spread of assets we aim to continue to deliver steady growth to our with profits policyholders.”

The fund will continue to allow investments into existing with profits pensions, including new members to existing GPPs. It will also accept switches into these plans, where allowed. Existing regular contributions to endowments can continue.

The next with profits bonus rate announcement is due on 19 February. Legal & General will be writing to our customers to advise them of the closure as part of the bonus mailing, or by separate letter for pension customers, by the end of May 2015.

The information contained in this press release is intended solely for journalists and should not be relied upon by private investors or any other persons to make financial decisions.

*With Profits Bonds: The sale of new Legal & General With Profits Bonds was suspended in January 2014. Legal & General With Profits Bonds were closed to increments at the end of December 2014.