information

We use cookies to make sure your experience is as good as it can be. If you’re happy with that, just continue using the site. Learn more about cookies here.

skip to main content

Protected Retirement Plan

Product profile for Protected Retirement Plan

Read below a summary of the relevant product information about the customer and trustee versions of our Protected Retirement Plan, in accordance with the Insurance Distribution Directive. Designed to help you make an informed decision and comparison for your client, we set out the product’s target market, distribution strategy, suitability, main features, risks, options and costs.

This information is also available in downloadable pdf format:

This is only a summary of the product features. For more information please read the Key Features documents and Policy Conditions.

The LV= Protected Retirement Plan is a Trustee investment that can provide a regular income for a fixed term, a guaranteed maturity value or a combination of a guaranteed income and guaranteed maturity value over a set term.

We believe the Protected Retirement Plan (trustee version) would be suitable as an investment of a Self-Invested Personal Pension (SIPP), as part of an individual member’s investment portfolio, to:

  • Provide a secure income for a fixed term, as part of a blended solution (with the balance of funds in a SIPP invested for growth)
  • Provide a guaranteed return at the end of a fixed period
  • Protect the initial investment, or income and/ or growth, if the scheme member dies during the plan term

We realise that PRP may also be considered by other member directed pension schemes, such as a Small Self-Administered Scheme (SSAS). However the product documentation has been designed purely on the basis that the investing scheme is a SIPP and so investments by other schemes would need to be considered on an individual basis.

The product is also available on a non-trustee basis.

The LV= Protected Retirement Plan is a Fixed Term Annuity primarily suitable for providing a regular guaranteed income for a fixed term, an agreed maturity date and the potential for an agreed maturity value. The Guaranteed Maturity Value is calculated at outset.

It can be set up on a standalone basis, or as a Trustee Investment Plan (TIP) within the LV= Flexible Transitions Account.

We believe the main group of individuals that the plan is likely to appeal to as part of their planning for retirement income are:

  • 55+ year olds with a built up fund in a registered pension scheme

The product is also available on a Trustee basis.

To ensure your client receives a product that is right for them we believe this product should generally be sold on an advised basis, whether this be face to face or over the phone.

For the customer version we will accept business through non-advised intermediaries, following completion of a full due diligence process.

  • Provides a guaranteed income over a fixed term
  • Available on a guaranteed maturity basis, income only, or mix of both
  • Level or increasing income
  • Choice of income payment frequency
  • Conversion facility
  • Option to add death benefits
  • Your client must choose any benefits before the plan starts. They can’t change them afterwards.
  • Although we guarantee the amount payable at the maturity date, we can’t guarantee what income this will provide. This depends on the economic and investment conditions at that time.
  • Unless your client includes death benefits in their plan, their income will stop if they die before the maturity date and nothing else will be paid out. This may result in an inadequate provision of benefits for their needs.
  • If your client chooses a level income, or an income that increases each year by less than inflation, their income may not keep up with rising prices.
  • For the trustee version, the plan is set up as a Trustee Investment Plan, as an investment of an existing registered pension scheme
  • Guaranteed Income over a fixed term up to 25 years. Minimum term applies.
  • Minimum investment is £10,000. There is no maximum (although investments over £500,000 will be reviewed on an individual basis)
  • The investment must be funded from a UK registered pension scheme with a minimum age at entry of 55 (or at least 40 for early ill-health retirement or a protected retirement age).
  • Your client can choose how and when they are paid their annuity. They can have level income or increasing income, at a fixed percentage. They can choose not to have any income at all.
  • They can choose the frequency of their income payments -monthly, three-monthly, six-monthly or yearly.

Is suitable for members who:

  • Wish to benefit from a guaranteed rate of investment return
  • want to invest some or all of their SIPP pension fund to provide a guaranteed income for a chosen number of years (up to 25 years)
  • Want to use some of their SIPP fund to secure income for a fixed term as part of a blended solution, with remaining pension funds to be invested for growth
  • Want to defer buying an annuity as they feel their circumstances may change in the future, for example because they’re in good health now, but feel their health may deteriorate in future, making them eligible for an enhanced annuity (with a better rate than that available from a standard annuity)
  • Want to guarantee their pension fund at the end of a chosen number of years
  • May want to pay to guarantee a regular income and/ or lump sum will be paid out if they die during the plan term
  • Are willing and able to accept the risk that the income they receive after the end of the plan term may not be as high as they anticipated or could have received by purchasing an annuity at outset. This may happen if, for example, annuity rates fall over the term of the plan.

Is not suitable for members who:

  • Want to guarantee a fixed income for life
  • Want to purchase a Lifetime Annuity
  • Are targeting significant growth with their pension fund & are willing / able to accept a degree of investment risk
  • May wish to drawdown the whole of their pension fund in one go, or within the first 3 years

Is suitable for clients who:

  • Wish to benefit from a guaranteed rate of investment return
  • Want to use their fund built up in a registered pension scheme to provide a set income for a chosen number of years (up to 25 years)
  • Want to use some of their pension fund to secure income for a fixed term as part of a blended solution, with remaining pension funds to be invested for growth
  • Want to defer buying an annuity as they feel their circumstances may change in the future, for example because they’re in good health now, but feel their health may deteriorate in future, making them eligible for an enhanced annuity (with a better rate than that available from a standard annuity)
  • Want to guarantee their pension fund at the end of a chosen number of years
  • May want to pay to guarantee a regular income and/ or lump sum will be paid out if they die during the plan term
  • Are willing and able to accept the risk that the income they receive after the end of the plan term may not be as high as they anticipated or could have received by purchasing an annuity at outset. This may happen if, for example, annuity rates fall over the term of the plan.
  • Want to guarantee that their annual income will only go down if limited by GAD limits in the future (only applicable to new customers transferring in an existing Capped Drawdown arrangement into a Capped Drawdown PRP)
  • May wish to drawdown the whole of their pension fund using Flexi-Access Drawdown
  • May be looking to avoid / mitigate against investment risk associated with stock market related investments

Is not suitable for clients who:

  • Want to guarantee a fixed income for life
  • Want to purchase a Lifetime Annuity
  • Are targeting significant growth with their pension fund & are willing / able to accept a degree of investment risk
  • May wish to drawdown the whole of their pension fund in one go, or within the first 3 years

We can only accept funds from a UK registered pension scheme or QROPS and the Trustee version can only be held as an investment of a SIPP.

To apply customers need to be a minimum age of 55 at entry (or at least 40 for early ill-health retirement or a protected retirement age) and a maximum age of 90 at maturity

To use our trustee version as an uncrystallised SIPP investment, the scheme member must be at least 40 years old.

Death benefits: Your client can choose to buy one or more of our optional death benefits at the start of the plan in case they pass away before the end of the term, with beneficiaries' income, guaranteed period options and value protection (customer version) or value protection and plan protection (trustee version). For more details, refer to the relevant Plan Conditions.

Conversion: Our conversion feature is included with all new contracts at no extra cost, and allows your client to end their existing plan and transfer out at any time should their circumstances change. The conversion value is not guaranteed. For more details, refer to the Plan Conditions.

Member benefits: With this policy your client automatically becomes a member and is entitled to a range of benefits, at no added cost. These include voting rights, free advice helplines and discounts on selected LV= products. These benefits are non-contractual and can be changed or removed at any time, and conditions apply. More details about LV= membership and member benefits are available at LV.com/members.

LV= Doctor Services: All new policyholders have access to a number of app-based medical services and advice, at no added cost. These include virtual GP consultations, prescription and second opinion services. These benefits are non-contractual and can be changed or removed at any time, and conditions apply. For more details visit LV.com.

Initial charge: We make a charge at the start of the plan to cover the set-up costs and our yearly administration costs. We take these into account before we calculate the starting income, if you choose this, and the guaranteed maturity value.

Conversion Option Charge: nil.

LV= Doctor Services is provided by Square Health Limited. This service is not regulated by the Financial Conduct Authority or Prudential Regulation Authority.

FOR UK FINANCIAL ADVISERS ONLY
LV=, County Gates, Bournemouth, BH1 2NF, UK