“Survey after survey continues to show that much of the with-profits market remains vulnerable to difficulty. The conundrum for savers who have these plans is to understand which category their plan falls into. Are they in the vulnerable category or in the safer category? We try through our site to produce a traffic light system which provides an indication of the position companies are in according to our research. Red companies are in the risky category; amber in the middle, green is looking OK. But it is very important to stress that this is a situation where the summaries are generalised and subjective. Two people with very similar situations could be in totally different territory when it comes to asking what should they do for the best? As an example this may be because one is in serious ill health and needs the value of the death benefit, the other in good health and looking at virtually no future bonus prospect and ever increasing penalties.
So although our traffic light system may tell you which companies are looking good and which aren’t, this only helps to a point. Our stress test is to suggest that the generalised position is put up against a specified and tailored report produced for an individual. The individual report is a bit like a health check. “Prevention is better than cure” is a well worn phrase but it really does apply here: most investors in with-profits will suffer a surprise if they suddenly find increasing penalties or a company running into trouble. Our health check (the individual review) will hopefully stop such a shock from occurring.”
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