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Changes to LV= Pension Fund Range

We're here to inform you about a change to the LV= Insured Pension fund range

Changes to LV= Pension Funds

We want to let you know about some changes we’re making to a number of the indexed tracker funds within the LV= Pension Fund range. The changes will have a direct impact on those invested in one or more of the following funds:

Series 1 Funds Fund code Series 2 Funds Fund code
LV= European Equity tracker (s1) 109 LV= Emerging Markets Equity Index (s2)
1246
LV= Far East Equity Tracker (s1) 111 LV= European Equity Tracker (s2)
1238
LV= Global Equity Index (s1)
98 LV= Far East Equity Tracker (s2)
1239
LV= Japanese Equity Tracker (s1) 110 LV= Japanese Equity Tracker (s2)
1241
LV= North American Equity Tracker (s1)
108 LV= North American Equity Tracker (s2)
1242
LV= UK Equity Tracker (s1)
107 LV= Sterling Corporate Bond All Stocks Index (s2) 1247
    LV= UK Conventional Gilts All Stocks Index (s2)
1245
    LV= UK Equity Tracker (s2)
1243
    LV= Balanced Index (s2)
1244
    LV= Global Equity Index (s2)
1240

Series 1 Funds Fund code Series 2 Funds Fund code
LV= European Equity tracker (s1) 109 LV= Emerging Markets Equity Index (s2)
1246
LV= Far East Equity Tracker (s1) 111 LV= European Equity Tracker (s2)
1238
LV= Global Equity Index (s1)
98 LV= Far East Equity Tracker (s2)
1239
LV= Japanese Equity Tracker (s1) 110 LV= Japanese Equity Tracker (s2)
1241
LV= North American Equity Tracker (s1)
108 LV= North American Equity Tracker (s2)
1242
LV= UK Equity Tracker (s1)
107 LV= Sterling Corporate Bond All Stocks Index (s2) 1247
    LV= UK Conventional Gilts All Stocks Index (s2)
1245
    LV= UK Equity Tracker (s2)
1243
    LV= Balanced Index (s2)
1244
    LV= Global Equity Index (s2)
1240

New Fund details following the migration of the Assets to Vanguard Asset Management (S1)

The table below shows the existing fund names, their new names, a comparison of the indexes they track and the Total Fund Charges (TFCs) that will apply from the transition date, together with an indication of how the Total Fund Charge has changed. The number of units held in your plan and their value will not be affected. We have also listed the fund codes to make it easier for you should you decide to make a change to the investments you have with us.

View table
Fund code Fund name
 Indexed tracked New TFC per year (change)
108 Old LV= North American Equity Tracker
Old FTSE® North America Index 0.35% 
(-0.04%)
New LV= Vanguard US Equity Index New S&P 500 Index
107 Old LV= UK Equity Tracker
No change FTSE® All-Share Index
0.34%
(-0.05%)
New LV= Vanguard FTSE UK All Share Index
109
Old LV= European Equity Tracker
No change FTSE® Developed Europe ex UK Index
0.30%
(-0.09%)
New LV= Vanguard FTSE Developed Europe ex-UK Equity Index
111 Old LV= Far East Equity Tracker
Old FTSE® Developed Asia Pacific ex Japan Index
0.30%
(-0.09%)
New LV= Vanguard Pacific ex-Japan Stock Index
New MSCI Pacific ex Japan Index

110

 

Old LV= Japanese Equity Tracker
Old FTSE® Japan Index
0.31%
(-0.08%)
New LV= Vanguard Japan Stock Index
New MSCI Japan Index

New Fund details following the migration of the Assets to Vanguard Asset Management (S2)

The table below shows the existing fund names, their new names, a comparison of the indexes they track and the Total Fund Charges (TFCs) that will apply from the transition date, together with an indication of how the Total Fund Charge has changed. The number of units held in your plan and their value will not be affected. We have also listed the fund codes to make it easier for you should you decide to make a change to the investments you have with us.

View table
Fund code Fund name
 Indexed tracked New TFC per year (change)
1246 Old LV= Emerging Markets Equity Index (s2)
Old FTSE® Emerging Markets Index
0.18% 
(-0.17%)
New  LV= Vanguard Emerging Markets Stock Index (s2)
New MSCI Emerging Markets Index
1238 Old  LV= European Equity Tracker (s2)
No Change FTSE® Developed Europe ex UK Index
0.09%
(-0.09%)
New  LV= Vanguard FTSE Developed Europe ex-UK Equity Index (s2)
1239
Old  LV= Far East Equity Tracker (s2)
Old FTSE® Developed Asia Pacific ex Japan Index
0.13%
(-0.09%)
New  LV= Vanguard Pacific ex-Japan Stock Index (s2)
New MSCI Pacific ex Japan Index
1243 Old LV= UK Equity Tracker (s2)
No change
FTSE® All-Share Index
0.05%
(-0.05%)
New LV= Vanguard FTSE UK All Share Index (s2)

1241

Old LV= Japanese Equity Tracker (s2)
Old FTSE® Japan Index
0.10%
(-0.08%)
New LV= Vanguard Japan Stock Index (s2)
New MSCI Japan Index
1242 Old LV= North American Equity Tracker (s2)
Old FTSE® North America Index
0.10%
(-0.04%)
New  LV= Vanguard US Equity Index (s2)
New S&P 500 Index
 1247 Old LV= Sterling Corporate Bond All Stocks Index (s2)
Old Barclays Sterling Aggregate 100 mm Non Gilts Index
0.06%
(-0.06%)
New LV= Vanguard UK Investment Grade Bond Index (s2)
New Bloomberg Barclays GBP Non- Government Float Adjusted Bond Index
 1245 Old LV= UK Conventional Gilts All Stocks Index (s2)
Old FTSE® Actuaries UK Gilts British Government All Stocks Index
0.06%
(-0.06%)
New LV= Vanguard UK Government Bond Index (s2)
New Bloomberg Barclays GBP UK Government Float Adjusted Bond Index

overview

Here's what you need to know

What's changing?

As part of our robust due diligence and investment governance process, we have recently reviewed the fund management of the index tracker funds in our Insured Pension fund range. As a result of the review, we’ve appointed Vanguard as the underlying asset manager for a number of the LV= pension funds, which were previously managed by SSgA. This means that the assets held within these LV= pension funds will move from SSgA to Vanguard over several weeks, during the weeks starting 16 July and 23 July 2018. If you’re already invested in one or more of the impacted funds, we have written to you and your financial adviser.


What are the benefits?

Our key driver is to ensure that our customers, new and existing, receive great value. Therefore the move to a new Investment Manager brings a variety of additional benefits:

  • Lower Annual Management Charges
  • Greater security of assets through a change of investment structure
  • The stability and experience of a well-known client focused retail asset manager

To help you understand where your monies will be invested we are changing the individual fund names to include the names of the new underlying assets. There will also be changes to the indexes they track and the Total Fund Charges (TFCs) of your LV= funds.

Changes to the Index Tracker Funds (Series 1 and Series 2)

All of the funds impacted by the change are index tracker funds. In some cases, the new underlying asset will track the same index, but for others, the assets will now track a similar alternative index. The changes are set out in the tables below, including details of the new, lower ongoing fund charges, and confirmation of the index each fund is tracking. The changes vary depending on whether you’re invested in Series One or Series Two funds, so please make sure you review the relevant tables for your investments. The value of your investments will not be impacted by this change. However, the future value will depend upon the performance of the new underlying investments selected.

View table
Series 1 Funds Fund code
Series 2 Funds Fund code
LV= European Equity tracker (s1)
109 LV= Emerging Markets Equity Index (s2)
1246 
LV= Far East Equity Tracker (s1)
111 LV= European Equity Tracker (s2)
1238
LV= Global Equity Index (s1)
98 LV= Far East Equity Tracker (s2)
1239
LV= Japanese Equity Tracker (s1)
110 LV= Japanese Equity Tracker (s2)
1241
LV= North American Equity Tracker (s1)
108 LV= North American Equity Tracker (s2)
1242
LV= UK Equity Tracker (s1)
107 LV= Sterling Corporate Bond All Stocks Index (s2)
1247
    LV= UK Conventional Gilts All Stocks Index (s2)
1245
    LV= UK Equity Tracker (s2)
1243
    LV= Balanced Index (s2)
1244
    LV= Global Equity Index (s2)
1240

Changes to the Balanced Index Fund (Series 2)

The asset allocation is changing within the Balanced Index fund to: reduce equity exposure from 80% to 60%, reduce the focus on UK equities, choosing a global approach instead (but still with some UK equity exposure), increase the proportion of the asset invested in fixed income assets, and diversify fixed income exposure from UK only, to global fixed income investments. The new allocation provides full global exposure to both equities and bonds – an approach that brings greater diversification benefits and gives investors access to the widest possible opportunity set.

View table

The asset allocation is changing within the Balanced Index fund to: 

  • reduce equity exposure from 80% to 60%,
  • reduce the focus on UK equities, choosing a global approach instead (but still with some UK equity exposure),
  • increase the proportion of the asset invested in fixed income assets, and
  • diversify fixed income exposure from UK only, to global fixed income investments.

The new allocation provides full global exposure to both equities and bonds – an approach that brings greater diversification benefits and gives investors access to the widest possible opportunity set.

Fund Name (Fund Code 1244) LV= Balanced Index (s2)
New TFC per year (Change)
0.09% (-0.04%)
New Benchmark
Old Benchmark
60% Vanguard FTSE Developed World Common Contractual Fund; 
40% Vanguard Global Bond Index Fund

 
80% Global Equity 50/50 Index Sub-Fund; 
6% UK Conventional Gilts All Stocks Index Sub-Fund; 
6% Sterling Non-gilts Bond All Stocks Index Sub-Fund;
3% UK Index Linked Gilts All Stocks Index Sub Fund 
and 5% Sterling Liquidity Sub-Fun
New Regional Weightings
Old Regional Weightings
UK 5.91% 
North America 53.77% 
Europe ex UK 22.12% 
Japan 10.15% 
Pacific Basin 3.60% 
Australasia 2.46% 
Americas 0.48% 
Middle East/Africa 0.32% 
Other 0.20% 
Not Specified 1.00%
UK 49.07% 
North America 13.29% 
Europe ex UK 13.36% 
Japan 6.69% 
Pacific Basin 6.61% 
Not specified 5.99% 
Money Market 4.99%

 

The value of your investments will not be impacted by this change. However, the future value will depend upon the performance of the new underlying investments selected.


Changes to the Global Equity Tracker Fund (Series 1)

The split between UK and overseas equities remains broadly similar after changes to this fund are made, but the regional split of overseas equities will change. This approach brings greater diversification and gives investors access to the widest possible opportunity set.

View table
Fund Name (Fund Code 98) LV= Global Equity Tracker (s1)
New TFC per year (Change)
0.34% (-0.05%)
New Benchmark
Old Benchmark
50% UK Equities 
50% Developed World ex UK Equities

 
50% in the UK Equity Index sub-Fund; 
16.7% in the North America Equity Index sub-Fund; 
16.7% in the Europe ex UK Equity Index sub-Fund; 
8.3% in the Japan Equity Index sub-Fund and 
8.3% in the Asia Pacific ex Japan Equity Index sub-Fund
New Regional Weightings
Old Regional Weightings
UK 49.71% 
North America 32.14% 
Europe ex UK 9.25% 
Japan 4.92% 
Pacific Basin 2.03% 
Australasia 1.44% 
Cash 0.39% 
Middle East/ Africa 0.11%
UK 50.09% 
North America 16.60% 
Europe ex UK 16.70% 
Japan 8.35% 
Pacific Basin 8.26%

 

The value of your investments will not be impacted by this change. However, the future value will depend upon the performance of the new underlying investments selected.


Changes to the Global Equity Tracker Fund (Series 2)

The split between UK and overseas equities remains broadly similar after changes to this fund are made, but the regional split of overseas equities will change. This approach brings greater diversification and gives investors access to the widest possible opportunity set.

View table
Fund Name (Fund Code 98) LV= Global Equity Tracker (s2)
New TFC per year (Change)
0.08% (-0.05%)
New Benchmark
Old Benchmark
50% UK Equities 
50% Developed World ex UK Equities

 
50% in the UK Equity Index sub-Fund; 
16.7% in the North America Equity Index sub-Fund; 
16.7% in the Europe ex UK Equity Index sub-Fund; 
8.3% in the Japan Equity Index sub-Fund 
and 8.3% in the Asia Pacific ex Japan Equity Index sub-Fund
New Regional Weightings
Old Regional Weightings
UK 49.71% 
North America 32.14% 
Europe ex UK 9.25% 
Japan 4.92% 
Pacific Basin 2.03% 
Australasia 1.44% 
Cash 0.39% 
Middle East/ Africa 0.11%
UK 50.09% 
North America 16.60% 
Europe ex UK 16.70% 
Japan 8.35% 
Pacific Basin 8.26%

 

The value of your investments will not be impacted by this change. However, the future value will depend upon the performance of the new underlying investments selected.


Questions and Answers

Why Vanguard Asset Management?

Founded in 1975 in the United States, Vanguard is one of the world’s leading fund managers, and vocal and effective champions of passive fund management. They believe in giving investors simple access to broadly diversified markets at the lowest possible cost. The less you pay for investments, the more you get to keep from your potential returns.
Their investment philosophy stands for high-quality funds and exceptional value. Vanguard, like LV=, are a mutual company sharing many similar qualities and we believe there is a great synergy between the two companies.

What does this mean for me?

The names of your existing assets will change to those set out in the tables attached to this letter. The new asset names, total fund charges and objectives will apply from the transition date. The number of units held in your plan and their value will not be affected.

What action do I need to take?

There are two choices available to you:

If you are happy with this change, you need do nothing. The new asset names, total fund charges and objectives will apply from the transition date. As stated previously the number of units held in your plan and their value will not be affected.
You can switch your holdings free of charge into one or more of the other LV= pension funds available. Your asset choices depend on whether you’re invested in Series 1 or Series 2, so please ensure you refer to the correct fund guide below. The letter we sent you to tell you about the changes should confirm which Series you’re invested in. 

LV= Pension Funds - Series 1 PDF 171KB 
LV= Pension Funds - Series 2 PDF 183KB

You can switch your holdings free of charge into one or more of the other funds available from LV=. A switch request can be made either by completing the fund switch request form. The form can be emailed to us at [email protected] We strongly recommend that you should discuss this with your financial adviser before taking any action as they will have access to your investment holdings and details of the other investment options available to you.

I need more information, what should I do?

We’ve answered some of the most common questions we’re asked when we make changes to funds in your questions and answers document, to ensure you all the information you need.

If you have any questions which aren’t covered in the FAQs, please contact your Financial Adviser. If you’re no longer in contact with your Financial Adviser, you can call us on 0800 0322 990 option 2, and we will be happy to help you. For textphone please dial 18001 first.

Please note we cannot provide you with any advice about your investments.