The case for with-profits remains as strong as ever

bond funds

Those predicting the imminent demise of the asset class that has been popular across the wealth spectrum look to be mistaken. Sales figures show an increase in popularity after years of poor performance

With-profits bonds have traditionally been the mainstay investment product in the UK insurance market. The asset class has provided a low-risk product for the investment portfolio of high-net-worth individuals as well as retail consumers. However, between 2000 and 2003, the market crumbled and sales of with-profits bonds declined by a compound annual rate of 40%. All with-profits products are complex and difficult for customers to understand so the key means of distribution is via the IFA channel. Such a dramatic change in fortunes is linked to the changing preferences of advisers and the...