Treating Customers Fairly in With Profits

Treating Customers Fairly (TCF)

TCF is a key part of principles-based regulation. There are outcomes laid out in the FSA’s principles. The FSA website gives full details of these outcomes and what it expects of both product providers and advisers.

Legal & General is committed to fulfilling its TCF requirements and helping advisers to help their customers.

With Profits

In May 2007 the FSA issued their 'Insurance Sector Briefing: Quality of post-sale communications in the life sector and availability of ongoing advice to with-profits policyholders' paper.

Adviser and insurer responsibilities

This paper requires both plan providers and advisers to help customers make informed decisions in relation to their With Profits investments.

In particular information should:

• Provide investment performance information so that customers (or their advisers) understand how their investment is performing.
• Enable customers to judge if the plan continues to meet their requirements.
• Remind customers of the key benefits of their plan, particularly if they are about to take action which could result in them losing these benefits.

Helping you

We understand that with the number of policies available across the UK market over the last few decades, and the different approaches to providing With Profits policies and products, it would be difficult for advisers to know the detail of all policies available.

We have therefore written the following summaries based around the actions that we believe will normally require specific advice. This information is available to help you understand the key considerations when advising a Legal & General With Profits customer at key events:

• Switching
• Pension transfers
• Early retirement
• Surrendering / early surrenders
• Taking Personal Retirement Plan benefits from age 60

For further information, please view the  With Profits TCF literature.

This is not an exhaustive list but provides a summary of what we believe should be considered. All customers are different and advisers should carefully consider, and be happy based on their own opinion, the specific advice / information required / provided for each individual.

Legal & General and With Profits

To help you understand a little more about Legal & General's With Profits contracts, we have provided the following questions and answers;

• Q. What is Contractual Annual Interest (CAI) / Contractual Minimum Addition (CMA)?
• Q. What is a Market Value Reduction (MVR)?
• Q. Which plans have guaranteed rates which can be used to turn the fund into a pension income (guaranteed annuity rates)?

You can also view our Customer Friendly Principles and Practices of Financial Management for more information on With Profits.