Interim bonuses

When a company declares a reversionary bonus after one of its periodic valuations, this applies only to the policies in force at the valuation date, and even then only for the period between the valuation just made and the one before that. However, if you make a claim, say six months after the valuation date, you are also entitled to a share of the profits which your insurer has earned since the last valuation. You cannot expect your insurer to make an additional full-scale valuation of assets and liabilities to determine your share of the profits for this short period, so at each valuation, a special rate of interim bonus applicable to all future claims payable until the next valuation may be announced. This interim bonus is usually a conservative estimate of the next reversionary bonus. It is not guaranteed, and in theory your insurer can stop paying it, though this would be most unusual.

Terminal bonuses: Over the last few years, some insurance companies have introduced a new type of bonus designed to reflect the large capital gains which they have made as a result of their successful investment policy. These bonuses, paid in addition to the ordinary reversionary bonuses already described, are allocated only to policies becoming claims by death or maturity. They are liable to fluctuate in line with general investment conditions, and the particular experience of each , insurer. The amount of some terminal bonuses also depends on the time the policy has been in force when the claim is made. For these reasons, some insurers prefer not to give terminal bonuses, but rather to adjust their normal reversionary bonuses. Terminal bonuses are usually expressed as either a percentage rate (such as 12 per cent) of the declared reversionary bonuses attaching when a claim is made, or as a proportion of the basic sum assured plus bonuses. Beware of estimated maturity values based on terminal bonuses : no one knows what the future holds and it is possible that terminal bonuses will be ' low ' when you come to claim. Ask for maturity estimates based on the reversionary bonuses only.


Interim bonuses

Payroll Giving
It’s all very easy to organise.
Just ask the Personnel or the Payroll Department at your company and, if they already have a scheme, they will give you the relevant forms.  HM Revenue & Customs’ website has a list of Payroll Giving agencies and explains payroll giving in more detail.

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read on: Special bonuses

When a company declares a reversionary bonus after one of its periodic valuations, this applies only to the policies in force at the valuation date, and even then only for the period between the valuation just made and the one before that. However, if you make a claim, say six months after the valuation date, you are also entitled to a share of the profits which your insurer has earned since the last valuation. You cannot expect your insurer to make an additional full-scale valuation of assets and liabilities to determine your share of the profits for this short period, so at each valuation, a special... see: Special bonuses