GROUP PERSONAL PENSION PLAN BOOKLET. The details of Your pension plan Friends Life: Your partner in pensions

Transcription

1 GROUP PERSONAL PENSION PLAN BOOKLET The details of Your pesio pla Frieds Life: Your parter i pesios

2 Cotets This pla booklet is divided ito 7 parts Part 1 Geeral iformatio ad glossary of terms Part 2 Cotributios Part 3 Beefits Part 4 How We work out the amout of the member s fud Part 5 Ivestmet fuds Part 6 Charges Part 7 Further iformatio

3 YOUR PLAN booklet Your pla booklet This booklet is about Your pesio pla. We call it a pla booklet. It may sometimes be referred to as a policy booklet. To give flexibility Your pla is divided ito a umber of arragemets. You ca fid out more about this i the Further iformatio part of this pla booklet. Itroductio This pla booklet cotais the mai terms ad coditios of the Frieds Life Group Persoal Pesio. These terms ad coditios are also govered by the rules of the Frieds Life (No.1) Persoal Pesio Scheme. If there is ay icosistecy betwee the Scheme rules ad this pla booklet, the Scheme rules prevail. You ca ask Us for a copy of the Scheme rules. HM Reveue & Customs (HMRC) or the Departmet for Work & Pesios (DWP) may require Us to chage the rules or the pla to meet with ay chages to law or regulatio. We will tell You of ay chages which are eeded to meet such requiremets. We reserve the right to delay calculatio of ay amout due uder the pla util We have received satisfactory proof of owership. Similarly, the exercise of rights coferred by the pla ad paymet of ay beefit is subject to the satisfactory proof of owership. Notwithstadig aythig to the cotrary i the policy, oly those optios described i this pla booklet will be made available uder this pla uless You are otified i writig to the cotrary by Us. You eed to tell Us as soo as You move to aother address. Your pla documet A pla documet is the evidece of the legal cotract betwee Us as the pesio provider ad You as the plaholder. Your Frieds Life Group Persoal Pesio pla documet is i two parts. This pla booklet which gives the geeral terms ad coditios which apply to the pla, icludig a glossary of the terms that We use. The pla schedule which gives more details which are specific to Your ow pla. We may issue more schedules i the future if some details chage. We may also issue statemets settig out ay chages We make to this pla booklet. You should keep these documets i a safe place as You may eed to produce them whe beefits become payable. I this booklet, refereces to writig or writte iclude ay other meas of commuicatio agreed betwee Us ad You. 2

4 Idepedet Help The Frieds Life (No.1) Persoal Pesio Scheme The Frieds Life (No.1) Persoal Pesio Scheme is operated uder the terms of a Deed Poll ad geeral rules. You ca ask Us for a copy of the Deed Poll ad the rules. The Frieds Life (No.1) Persoal Pesio Scheme is a Registered Pesio Scheme. This meas that Your pla has the tax advatages ejoyed by Registered Pesio Schemes. The Scheme Admiistrator is Frieds Life Limited whose address is Frieds Life Admiistratio Cetre, PO Box 582, Bristol, BS34 9FX, Uited Kigdom. Idepedet Help The Pesios Advisory Service (TPAS), is available to assist members ad beeficiaries of the Scheme i coectio with ay difficulties which they may have failed to resolve with the admiistrators of the Scheme, icludig the provisio of further iformatio to members, or to provide assistace i obtaiig the correct legal etitlemet for a pesio scheme. If TPAS is uable to resolve the problem but believes a member s complait is valid it will assist a member i makig a formal complait to the appropriate Ombudsma (the Pesios Ombudsma or the Fiacial Ombudsma Service). The Pesios Ombudsma ivestigates complaits of ijustice i cosequece of maladmiistratio of the Scheme. The address of the Pesios Ombudsma is the same as for TPAS. The address of TPAS is: 11 Belgrave Road Lodo SW1V 1RB Phoe: Fax: equiries@pesiosadvisoryservice.org.uk Website: The Fiacial Ombudsma Service is available to ivestigate ad determie complaits or disputes of fact or law i relatio to the Scheme. The address of the Fiacial Ombudsma service is: Exchage Tower Harbour Exchage Square Lodo E14 9SR Uited Kigdom Phoe: Mobile: (calls to this umber are charged at the same rate as 01 or 02 umbers o mobile phoe tariffs) complait.ifo@fiacial-ombudsma.org.uk Website: 3

5 Geeral iformatio ad glossary of terms Part 1 Geeral iformatio ad glossary of terms 1.1 Geeral iformatio Throughout this pla, words i the sigular will iclude the plural ad vice versa, uless We say otherwise. Also, words that are i the masculie geder will iclude the femiie ad vice versa. Whe We refer to ay law or regulatio i this pla, this will iclude ay later chage made to that law or regulatio, or ay chage that is coected with it. Defiitios of some of the terms used i this pla are show i the glossary o pages 5 ad 6. Some of the words are also defied i the rules of the Scheme. 1.2 Geeral pla provisios I makig decisios ad exercisig discretios give to Us uder these plas terms, We will act reasoably ad with proper regard to the eed to treat You ad Our other customers fairly We reserve the right from time to time by givig You 30 days writte otice, so far as it is practicable to do so, to make chages or additios to these terms as are reasoably required to reflect chages i applicable pesios, tax or other law, legislatio, regulatio or idustry codes of practice which affect Your pla We reserve the right from time to time by givig You 30 days writte otice, so far as it is practicable to do so, to make such chages or additios to these terms ad coditios as are reasoably required to reflect: chages i how the Lodo Stock Exchage or other relevat ivestmet or regulated markets may work which may impact o the operatio of Your pla; chages i ivestmet/share dealig admiistratio or other ifrastructure facilities, systems or meas of commuicatio which impact o the provisio ad operatio of Your pla ad which are outside of Our cotrol; chages to services relatig to Your pla supplied to us by third parties; chages i circumstaces or the happeig of ay evet which is outside of Our cotrol which meas that the Pla s terms ad coditios operate i a way which is ufair to You or other plaholders; chages resultig from the itroductio of ew systems, services, ad chages i techology outside of Our cotrol; chages i circumstaces or the happeig of ay evet which is outside of Our cotrol ad which makes it impossible, impracticable or ecoomically uviable for us ot to make a chage to the terms ad coditios, provided that ay such chage is ot ufair to You or other plaholders; chages required to remedy errors where it is reasoable to do so You should otify Us if You are uhappy with the proposed chage or additio to the terms ad coditios You are otified of uder sectio or above, i which case You may trasfer to aother Registered Pesio Scheme, subject to the potetial applicatio of a market value reductio (MVR) to ay Uits i the With Profits Fud (please see Part 7 Further Iformatio for more details of the MVR) We reserve the right from time to time to make chages or additios to these terms ad coditios for ay admiistrative or other reaso, which may or may ot have a detrimetal affect upo You, ad which are ot set out i sectio or above. If You suffer a detrimet as a result of those chages or additios You may otify Us ad You will be free to trasfer Your pla to aother Registered Pesio Scheme. We will waive the applicatio of a market value reductio to ay applicable Uits i the With Profits Fud (there are o charges o the trasfer of Uits i the uit-liked Ivestmet Fuds) provided that the trasfer is made withi 3 moths (or such loger period as may be reasoably ecessary i the circumstaces) from the date o which We gave You writte otice of the chage or additio We will sed ay otice to Your last kow address o Our records. We will assume that ay otice set by post will be received by You withi three workig days Frieds Life ad You have a free choice about the law that ca apply to a cotract. Frieds Life proposes to choose the law of Eglad ad Wales, ad, by eterig ito this cotract, you agree that the law of Eglad ad Wales applies. 4

6 Geeral iformatio ad glossary of terms These pla terms will oly apply to Your pla provided they are ot held by a relevat court or viewed by the Fiacial Coduct Authority to be ufair cotract terms or reasoably cosidered by Us to be ufair cotract terms. If a term is held, viewed or cosidered to be ufair it will, as far as possible, still apply but without ay part of it which would cause it to be held, viewed or cosidered to be ufair. 1.3 Glossary of terms We use certai techical words ad phrases i this pla booklet. To help You, this sectio explais what they mea. Act meas the Fiace Act 2004 (as ameded from time to time). Admiistratio Headquarters meas Frieds Life Admiistratio Cetre, PO Box 582, Bristol, BS34 9FX, or such other address as We may advise from time to time. Aual allowace charge meas a tax charge o the plaholder ad has the meaig set out i the Act. Automatic Erolmet meas the process by which a employer erols Jobholders ad Etitled Workers ito the Scheme, as required uder Automatic Erolmet Regulatios. Automatic Erolmet Regulatios meas the provisios relatig to pesio scheme membership for Jobholders set out i Part 1 of the Pesios Act 2008, as ameded, ad supportig secodary legislatio (icludig but ot limited to the Occupatioal ad Persoal Pesio Scheme (Automatic Erolmet) Regulatios 2010), all as ameded from time to time. Chose retiremet age is the age at which You expect to retire. It is chose whe Your pla is set up ad is show o the schedule. Civil parter meas a registered civil parter as set out i sectio 1(1) of the Civil Partership Act Default Ivestmet Solutio meas the Ivestmet Fud or Fuds ito which cotributios are ivested util, or uless You make a alterative ivestmet choice, or as subsequetly otified by Us to You. Eligible Jobholder meas a perso who meets the requiremets of sectios 1(1) ad 3(1) of the Pesios Act 2008 i relatio to the employer. Etitled Worker meas a perso who meets the requiremets of sectio 9(1) of the Pesios Act 2008 i relatio to the employer ad who has opted ito membership of the Scheme i accordace with sectio 9(2) of the Pesios Act Exteral Fud meas a fud maaged by a Exteral Fud Maager ito which Our Ivestmet Fuds may ivest. Exteral Fud Maager meas a compay other tha Frieds Life Limited who maages a Exteral Fud. Fiacial Coduct Authority meas The Fiacial Coduct Authority or ay regulator that may eed to replace its regulatory fuctio from time to time. HMRC meas HM Reveue & Customs. Ivestmet Compay meas a compay which operates or maages a Ivestmet Fud. You ca fid more details i sectio 5.1. Ivestmet Fud meas oe of the rage of pesio ivestmet fuds that You ca ivest i. It ca be (a) oe of the uit-liked Ivestmet Fuds described i sectio 5.1, (b) or the With Profits Fud described i sectio 5.4, or (c) a Reassurace Fud described i sectio Jobholder meas a Eligible Jobholder or a perso who meets the requiremet of sectio 1(1) of the Pesios Act 2008 i relatio to the employer ad who has opted ito membership of the employer s pesio scheme i accordace with sectio 7 of the Pesios Act Lifetime Auity has the meaig set out i Paragraph 3 of Schedule 28 of the Act. We may also refer to this as a auity i this pla booklet. Member s Fud meas the value of each arragemet uder the pla at the time We work it out. It is worked out i lie with Part 4. (You ca fid details of arragemets i Part 7 - Further iformatio.) Deposit Fud meas a Ivestmet Fud available uder the pla that is ivested wholly i cash deposits. 5

7 Geeral iformatio ad glossary of terms Oe-off Charge meas the charge made each ad every time uits are purchased i specified Ivestmet Fuds. Details of the Ivestmet Fuds to which this charge applies ca be obtaied from us. If You chose to ivest i a fud to which a Oe-off Charge applies, the amout of the charge will be cotaied i the Key Features illustratio, or ca be obtaied by cotactig Us. We may chage the amout of the Oe-off Charge i accordace with sectio 6.5. Paid-up meas o further regular cotributios are beig paid ito the pla ad the pla beefits deped o the ogoig residual value (if ay) of the pla. Protected pesio age is as set out ad defied i paragraphs of Schedule 36 of the Act. Reassurace Fud meas a specific type of exteral fud operated or maaged by aother life isurace compay. Registered Pesio Scheme meas a pesio scheme which is registered with HMRC pursuat to Chapter 2, Part 4 of the Act. Scheme meas the Frieds Life (No.1) Persoal Pesio Scheme or ay other scheme which replaces it. Selected retiremet age has the same meaig as Chose retiremet age. Small Lump Sum Paymet meas a paymet permitted uder Sectio 164 (1) (f) or Paragraph 7A of Schedule 29 of the Act. Uit Each Ivestmet Fud is divided ito oe or more series of otioal Uits. We allocate Uits to a pla so that the value of that pla may be worked out from time to time. As the holdig of Uits is otioal it does ot create ay iterest i the asset We treat as part of a Ivestmet Fud. Uit Price meas the otioal value of each Uit i a Ivestmet Fud as worked out i sectio (for uit-liked fuds) or sectio (for the With Profits Fud). The Uit Price is used to work out the value of plas from time to time. Valuatio meas workig out the value of a Ivestmet Fud usually so that the Uit Price of the Uits i that Ivestmet Fud ca be determied. This is described i sectio 5.3 ad sectio 5.4. You/Your ormally meas the member specified i the schedule. However, it ca mea the spouse, Civil parter or depedats of the member if they are receivig a auity payable after the death of the member. We/Us/Our meas Frieds Life Limited or its successors i title. It ca also mea a subsidiary or associated compay which is resposible for the operatio of the pla, or part of it. It may, for example, iclude a compay which operates or admiisters a Ivestmet Fud. With Profits Fud meas the With Profits Fud described i sectio 5.4 or ay ew or replacemet With Profits Fud or With Profits bous series as described i sectio 5.4. Total Member s Fud meas the total of the member s fuds uder all the arragemets uder the pla or those arragemets which are beig valued if We are workig out the value of oly part of the pla. Ucrystallised Fuds Pesio Lump Sum has the meaig set out i paragraph 4A of Schedule 29 of the Act. 6

8 Cotributios Part 2 Cotributios 2.1 Payig cotributios You ad Your employer, if applicable, ca make cotributios to the pla withi the cotributio limits set out i the Scheme rules. We may set a miimum level of cotributio. We reserve the right to chage the miimum level of cotributio from time to time i accordace with the terms of this pla. You ca get details of the curret miimum level of cotributio from Us. Cotributios which are paid o a regular mothly, four weekly or aual basis will be referred to as regular cotributios. Your pla schedule will show: the amout of the cotributios that are beig paid to the pla; how ofte the cotributios eed to be paid; ad the dates whe cotributios are due to be paid. Regular cotributios must be paid by direct debit istructio. Sigle cotributios may be paid at ay time by cheque. This applies to each arragemet separately. (For more iformatio o arragemets, please see Part 7 - Further iformatio.) If this pla forms part of a employer s pesio scheme which is beig used to comply with Automatic Erolmet Regulatios, the followig requiremets must be met whilst You remai a Jobholder for whom Your employer is required to provide active membership: total cotributios must be at least the miimum level required uder the Automatic Erolmet Regulatios; the level of cotributios paid by Your employer must be at least the miimum level required uder the Automatic Erolmet Regulatios; ad where a shortfall occurs betwee these amouts whilst You remai a active member of this Scheme You must pay cotributios which, however calculated, are equal to or more tha the shortfall. We may set up a ew Pla withi Your employer s pesio Scheme if: We are uable to accept cotributios to this Pla; or You have take beefits before Your 75th birthday ad remai i employmet ad Your employer is required to pay cotributios to comply with the Automatic Erolmet Regulatios. If cotributios alter at all i the future, ad this pla forms part of Your employer s pesio Scheme which has bee arraged to comply with Automatic Erolmet Regulatios, the requiremets set out above must be met. 2.2 Optio to start or icrease regular cotributios You or Your employer, if applicable, may ask for regular cotributios to start or to icrease from ay date whe regular cotributios are due. O receipt of ay such request, we will advise You of the terms that will apply, which will be Our curret terms at the time the cotributios start or the icrease takes effect. Ay cotributio made must ot be such a amout that would give rise to a Aual allowace charge. 2.3 Optio to iclude automatic icreases You or Your employer, if applicable, ca choose that regular cotributios icrease by 5% each year. This is the oly amout they ca icrease by. The optio is available to You ad Your employer, if applicable, separately, o the cotributio that You or they make. The optio ca be used whe the pla is take out, or at ay time later as log as regular cotributios are still beig paid. Icreases will take place o each aiversary of the pla start date or o aother date agreed with us. You or Your employer, if applicable, ca stop future automatic icreases at ay time by tellig Us at least 14 days before the icrease is due. The terms which apply to ay icrease i regular cotributios will be those that are curret at the time the icrease takes effect. 2.4 Optio to reduce regular cotributios You or Your employer, if applicable, may wat to reduce the regular cotributios. This ca be doe from ay date whe regular cotributios are due as log as We are told at least 30 days i advace. The reduced cotributio must be the same or more tha Our miimum at that time. The terms which apply to the reduced regular cotributios will be those that are curret at the time the reductio is made. 7

9 Cotributios 2.5 Stoppig regular cotributios You ad Your employer, if applicable, may wat to stop payig regular cotributios. This ca be doe from ay date whe regular cotributios are due as log as We are told at least 30 days i advace. If regular cotributios to the pla stop, the pla is made Paid-up. Regular cotributios must be paid i the way described i: sectio Payig cotributios ; ad the schedule. If they are ot, the pla will be made Paid-up oe moth after the date whe the first upaid regular cotributio should have bee paid. You may become ieligible for cotributios to be paid ito the pla. If so, the pla will be made Paid-up from the date that you become ieligible. We will deal with cotributios received after that date i lie with the Scheme rules. 2.6 Startig regular cotributios agai If Your pla has bee made Paid-up as described i sectio 2.5 You ca ot start to pay regular cotributios ito Your pla agai. You or Your employer, if applicable, ca start to pay regular cotributios ito a ew pla. The ew regular cotributios ca be made at the previous level or You ca pay a amout equal to the regular cotributios that have ot bee made, as log as the cotributio limits are ot broke. Please cotact Us at Our Admiistratio Headquarters for details. The terms ad coditios applyig to Your ew pla will be those which are curret at the time Your cotributios start agai. We will start the ew pla o the date whe the first ew cotributio is received by Us. 2.7 Sigle cotributios You or Your employer, if applicable, may make a sigle cotributio at ay time before the date that retiremet beefits are take. The amout of the sigle cotributio must ot be less tha the miimum that We will accept ad must ot be such a amout that would give rise to a Aual allowace charge. The terms which apply to a sigle cotributio will be Our curret terms at the time the paymet is made. 2.8 Makig trasfer paymets to the pla You may ask Us to accept a trasfer paymet ito the pla from other Registered Pesio Schemes or qualifyig recogised overseas pesio schemes. The coditios for acceptig trasfer paymets are i the Scheme rules. O receipt of ay such request We will advise You of the terms which apply to the ivestmet of the trasfer paymet ito the pla which will be Our curret terms at the time that We receive the trasfer paymet. 8

10 Beefits Part 3 Beefits 3.1 Geeral iformatio The pla gives You beefits as outlied i this sectio. The iformatio i this sectio ca refer to either the whole of the pla or just those arragemets uder the pla which are ivolved. More details o arragemets are give i Part 7 Further iformatio. You must tell Us whe You wat to take beefits by writig to Us (or ay other way that We may agree to) at our Admiistrative Headquarters so that We ca prove that the perso makig this request is allowed to do this. You ca take retiremet beefits at ay of the followig times. The Chose retiremet age which is show i the schedule. Ay other date that You choose betwee Your 55th ad 75th birthdays. Before Your 55th birthday but oly if HMRC has agreed to this ad from ay age less tha 55 where You have bee otified that you have a Protected pesio age. Before Your 55th birthday if retiremet is due to ill-health which stops You cotiuig to work. You do ot eed to cease employmet before You take Your beefits. If You take Your beefits aytime before Your 75th birthday ad remai i employmet ad Your employer is required to pay cotributios to comply with Automatic Erolmet Regulatios We may set up a ew pla withi Your employer s pesio Scheme. 3.2 Takig beefits at the Chose retiremet age The pla will be set up with a Chose retiremet age. This is the age at which You expect to retire. This may be chaged i lie with sectios 3.3 to 3.5. To take beefits at the Chose retiremet age you must tell us i writig at least 14 days before the Chose retiremet age. The Member s Fud available to secure beefits at the Chose retiremet age will be worked out i lie with sectio 4.3. If You do ot tell Us that beefits are to be take at the Chose retiremet age or that beefits are beig delayed to a specified late retiremet age (as i sectio 3.4) We will assume that uspecified late retiremet will be take (as i sectio 3.5) uless cotributios are cotiuig to be paid whe we will set a specified late retiremet age of your 75th birthday. 3.3 The optio to choose a early retiremet age You ca choose to take retiremet beefits before the Chose retiremet age (or the specified late retiremet age, if applicable). This depeds o the dates described i sectio 3.1. The chose date is kow as the early retiremet age. To choose this optio, You must tell Us i writig (or by ay other meas that We may agree to). The early retiremet age will be either: the date We receive all of the iformatio required to eable Us to complete Your retiremet request; or ay other date allowed ad that We agree with You. The Member s Fud available to secure beefits at the early retiremet age will be worked out i lie with sectio The optio to choose a specified late retiremet age You ca choose to delay takig retiremet beefits util a particular date after Your Chose retiremet age. This date is kow as the specified late retiremet age. It must be withi the dates set out i sectio 3.1. To choose this optio You must tell Us i writig (or by ay other meas that We may agree to) at least 14 days before the Chose retiremet age. If You or Your employer, if applicable, are payig regular cotributios You may cotiue to pay them. The Member s Fud available to secure beefits at the specified late retiremet age will be worked out i lie with sectio

11 Beefits 3.5 The optio to choose a uspecified late retiremet date As a alterative to sectio 3.4, You ca choose to delay takig retiremet beefits util after the Chose retiremet age, but before age 75, without choosig a particular date o which beefits will start. This is kow as the uspecified late retiremet date. To choose this optio You must tell Us i writig (or by ay other meas that We may agree to) at least 14 days before the Chose retiremet age. I this case, either You or Your employer, if applicable, will be able to make regular cotributios after the Chose retiremet age. You may choose to take retiremet beefits at ay future date that sectio 3.1 allows. To do this, You must tell Us i writig (or by ay other meas that We may agree to) that beefits are to be take. We will the pay the beefits from: the date We receive all of the iformatio required to eable Us to complete Your retiremet request; or ay other date allowed ad that We agree with You. The Member s Fud available to secure beefits at a uspecified late retiremet date will be determied i accordace with sectio Paymet of beefits at retiremet The Total Member s Fud will be available to provide retiremet beefits, subject to Our terms at the time. Retiremet beefits ca cosist of the followig: a Lifetime Auity; or a Lifetime Auity for You ad for Your spouse, or Civil parter ad/or depedats which will be paid after You die; or takig a cash lump sum, as a Ucrystallised Fuds Pesio Lump Sum; or a Small Lump Sum Paymet. Whe You retire, You ca choose to take part of the retiremet beefits as a tax-free cash sum if the Scheme rules allow this. Ay auity must be set up ad paid i lie with the Scheme rules. Pesios caot be assiged or cashed i uless the Scheme rules allow it. The Scheme rules allow the member to choose which isurace compay provides the auity. If We are chose, the amout of auity the Member s Fud buys will deped o Our auity rates whe the auity is bought. If aother isurace compay is chose to provide the auity, the amout that is trasferred to that isurace compay will be the value of the Total Member s Fud worked out i lie with the relevat sectio of Part 4, less ay tax-free cash sum paid by Us. 3.7 Provig Your age ad that You are etitled to receive retiremet beefits Before ay retiremet beefits are provided, You must prove Your age ad idetity to Our satisfactio. If a auity is beig bought for a spouse, Civil parter or depedat their age ad idetity must also be proved. We ca ask for evidece that the auitat is still alive before cotiuig to pay their auity. 3.8 Beefits o death If You die before takig all of Your retiremet beefits the pla s value will be available to provide beefits i lie with the Scheme rules. The value of the pla will be worked out i lie with sectio Geeral coditios about retiremet beefits If the auity is less tha 300 a year, We may ot allow You to receive istalmets of the auity more ofte tha oce a year. We may ot allow the full rage of guaratee periods uder this pla that the Scheme rules allow. We may ot allow auities which: icrease i paymet i lie with the Retail Prices Idex; or are liked to bouses that We declare regularly, uless the Member s Fud used to buy the auity at retiremet is greater tha the amout which We specify from time to time. You ca cotact Us for more details Trasfer paymets If You wat to, the value of all or part of the pla ca be trasferred to aother Scheme or pla which is a Registered Pesio Scheme or a qualifyig recogised overseas pesio scheme. You ca fid full details o this i the Scheme rules. The trasfer must be made before retiremet beefits are take. The trasfer date will be either: the date that We receive all of the iformatio required to eable Us to complete Your trasfer request; or ay other date allowed ad that We agree with You. You should ask Us for a trasfer paymet i writig (or by ay other meas that We may agree to). The amout of the trasfer paymet will be worked out i lie with sectio

12 How we work out the amout of the member s fud Part 4 How We work out the amout of the Member s Fud 4.1 Geeral iformatio Your Member s Fud is worked out for each arragemet separately. (You ca fid details of arragemets i Part 7 - Further iformatio.) The term Member s Fud is used i the Scheme rules. The Total Member s Fud meas the total of Your fuds either: uder all arragemets uder the pla; or uder those arragemets which are beig valued; depedig o whether We are workig out the value of the whole of the pla or oly part of it. The pla (either i whole or i part) ca oly be cashed i to provide beefits which are allowed by the Scheme rules. Whe We work out the value of the Total Member s Fud We may make, what We believe to be, a reasoable allowace: for ay levy imposed by law; for ay curret or potetial liability; or a adjustmet arisig from: chages to the terms of the pla as described i sectio 1.2; compliace with a court order; the correctio of a error that would otherwise affect the value of the Total Member s Fud; the deductio of ay tax charge i coectio with a uauthorised member paymet as defied i the Scheme rules. 4.2 If You die before takig retiremet beefits If You die before takig retiremet beefits the value of the Total Member s Fud will be equal to: the umber of Uits i each Ivestmet Fud attachig to the pla whe You die; multiplied by their Uit Price at the ext valuatio of Uits after We are told about Your death; plus the amout of ay regular cotributios or sigle cotributios, received by Us before Your death, but for which uits are retrospectively allocated after your death; multiplied by their Uit Price at the ext valuatio of Uits after We are told about Your death. Ay cotributios received by Us after Your death will be refuded. If the pla is ivested i the With Profits Fud, We may pay a extra bous, called a termial bous, which We will work out at the time. 4.3 If You take retiremet beefits at the Chose retiremet age If You take retiremet beefit at the Chose retiremet age the value of the Total Member s Fud will be equal to: the umber of Uits i each Ivestmet Fud attachig to the pla, icludig those purchased by ay cotributios due up to ad icludig the date o which beefits are due; multiplied by their Uit Price at the date We receive all the iformatio required to make the paymet. If the pla is ivested i the With Profits Fud, We may pay a extra bous, called a termial bous. We will decide the amout of the termial bous, if ay, at the time. Ay cotributios received by Us after the date o which beefits are due will be refuded. It may be that o the date We receive all the iformatio required to make the paymet there are With Profits Fud Uits i the pla which have bee allocated i the previous five years. If there are, ad they come from: a sigle cotributio; a trasfer paymet; or a switch of ivestmet ito the With Profits Fud, their value may be reduced by a MVR. We will decide the amout of the reductio, if ay, at the time. You ca fid details of the MVR i Part 7 - Further iformatio. 4.4 If You take retiremet beefits at the specified late retiremet age If You take retiremet beefits at the specified late retiremet age the value of the Total Member s Fud will be equal to: the umber of Uits i each Ivestmet Fud attachig to the pla, icludig those purchased by ay cotributios due up to ad icludig the date o which beefits are due; multiplied by their Uit Price at the date We receive all the iformatio required to make the paymet. 11

13 How we work out the amout of the member s fud If the pla is ivested i the With Profits Fud, We may pay a extra bous, called a termial bous. We will decide the amout of the termial bous, if ay, at the time. Ay cotributios received by Us after the date o which beefits are due will be refuded. The value of ay Uits i the With Profits Fud Uits may be reduced by a MVR. We will decide the amout of the reductio, if ay, at the time. You ca fid details of the MVR i Part 7 Further iformatio. 4.5 If You take retiremet beefits at a early retiremet age If You take retiremet beefits at a early retiremet age the value of the Total Member s Fud will be equal to: the umber of Uits i each Ivestmet Fud attachig to the pla, icludig those purchased by ay cotributios due up to ad icludig the early retiremet age (i lie with sectio 3.3); multiplied by their Uit Price at the date We receive all the iformatio required to make the paymet. If the pla is ivested i the With Profits Fud, We may pay a extra bous, called a termial bous. We will decide the amout of the termial bous, if ay, at the time. Ay cotributios received by Us after the date o which beefits are due will be refuded. The value of ay Uits i the With Profits Fud may be reduced by a MVR. We will decide the amout of the reductio, if ay, at the time. You ca fid details of the MVR i Part 7 - Further iformatio. 4.6 If You take retiremet beefits at a uspecified late retiremet date If You take retiremet beefits at a uspecified late retiremet date the value of the Total Member s Fud will be equal to: the umber of Uits i each Ivestmet Fud attachig to the pla, icludig those purchased by ay cotributios due up to ad icludig the uspecified late retiremet age (i lie with sectio 3.5); multiplied by their Uit Price at the date We receive all the iformatio required to make the paymet If the pla is ivested i the With Profits Fud, We may pay a extra bous, called a termial bous. We will decide the amout of the termial bous, if ay, at the time. Ay cotributios received by Us after the date o which beefits are due will be refuded. The value of ay Uits i the With Profits Fud may be reduced by a MVR. We will decide the amout of the reductio, if ay, at the time. You ca fid details of the MVR i Part 7 - Further iformatio. 4.7 If the value of the Total Member s Fud is trasferred to aother scheme or pla If the value of the Total Member s Fud is trasferred to aother scheme or pla the value of the Total Member s Fud will be equal to: the umber of Uits i each Ivestmet Fud attachig to the pla at the trasfer date (i lie with sectio 3.10), icludig those purchased by ay cotributios due up to ad icludig the trasfer date; multiplied by their Uit Price at the ext valuatio of Uits after the trasfer date. If the pla is ivested i the With Profits Fud, We may pay a extra bous, called a termial bous. We will decide the amout of the termial bous, if ay, at the time. Ay cotributios received by Us after the trasfer date will be refuded. The value of ay Uits i the With Profits Fud may be reduced by a MVR. We will decide the amout of the reductio, if ay, at the time. You ca fid details of the MVR i Part 7 - Further iformatio. 4.8 Delayig the workig out of the Total Member s Fud We may delay workig out the value of the Total Member s Fud if the pla is affected by ay of the situatios described i sectio

14 ivestmet fuds Part 5 Ivestmet Fuds 5.1 Geeral iformatio We will make a rage of Ivestmet Fuds available. You ca fid out more about how these work i sectio Uit-liked Ivestmet Fuds ad sectio With Profits Fud. We may chage the umber of fuds from time to time. We may also close fuds i lie with sectio 5.7- What happes if a Ivestmet Fud is closed - ad may make ew fuds available. We may operate these fuds ourselves or We may appoit other life isurace compaies to do this. We may chage or ed a arragemet We have with aother compay at ay time, as log as: the member s rights to beefits are ot reduced at the time the arragemets are chaged or eded; ad We make other arragemets for the pla. We, the Ivestmet Compay or its ivestmet maager will take ito accout the geeral aims or objectives of the Ivestmet Fud but, apart from this, will have full discretio i relatio to the fud s ivestmet policy. We will edeavour to give You prior writte otice of ay material chage i the risk profile or ivestmet strategy of a Ivestmet Fud. We may make available Ivestmet Fuds which maily ivest i fuds maaged by other Ivestmet Compaies, or are maaged specifically by other life isurace compaies. I this pla booklet both types of fuds are kow as Exteral Fuds. You ca fid more iformatio about these i sectio 5.12 ad We may chage the rage of Exteral Fuds available at ay time. We may limit the rage of Ivestmet Fuds available for particular plas. A pla caot ivest i more tha te Ivestmet Fuds at ay oe time. You ca ask Us for details of the Ivestmet Fuds available. If You do ot choose a Ivestmet Fud ito which cotributios to Your pla will be ivested, the all cotributios will be applied to the Default Ivestmet Solutio or i the evet there is o Default Ivestmet Solutio, a fud of Our choice We reserve the right from time to time by givig You 30 days writte otice, so far as it is practicable to do so, ad provided it shall ot have a detrimetal effect upo Your pla, to make chages or additios to the Ivestmet Fuds as are reasoably required: to cotiue to maage ay Ivestmet Fud i lie with ay aims that We have already set out; or to cotiue to value ay Ivestmet Fud i lie with the terms set out i this pla booklet. We may also stop all dealigs i Uits for a temporary period for ay of the above reasos If a evet described i sectio 1.2, 5.1.2, or 5.7 meas that We decide to make chages to or to close a Ivestmet Fud but it does ot affect all of the Ivestmet Fuds the We will edeavour to tell all those plaholders with Uits i the affected fuds at least 30 days before the date the fuds will be withdraw, coverted, merged closed to ew paymets or Uits exchaged or will be subdivided. Where We are uable to give 30 days otice We will give as much otice as is reasoably practicable. These plaholders will the have 30 days to trasfer Uits ito ay other available Ivestmet Fud. The plaholders watig to do this must ask Us i writig (or i ay other way that We may agree to). We will deal with the trasfer i the way We describe i sectio 5.8. If o respose is received cofirmig a alterative Ivestmet Fud to be used, withi the otice period, We will surreder all Uits that You hold i that Ivestmet Fud ad use the proceeds to purchase Uits i a Ivestmet Fud of Our choice which we reasoably cosider to have ivestmet objectives ad risk most early matchig those of the closig Ivestmet Fud. We will deal with the trasfer i the way We describe i sectio 5.8. We reserve the right to withdraw the Default Ivestmet Solutio i respect of past ad/or future cotributios ad to omiate a ew Default Ivestmet Solutio. We will edeavour to give You at least 30 days otice of ay chage i the Default Ivestmet Solutio available to You If You are automatically erolled ito, or joi a Automatic Erolmet Scheme, all cotributios will be applied to the Default Ivestmet Solutio. For other Schemes, You ca choose Ivestmet Fud(s) whe You start the pla. If You do ot make a choice, all cotributios will be applied to the Default Ivestmet Solutio. 13

15 ivestmet fuds 5.2 Uits Each Ivestmet Fud is divided ito shares of equal value. These are kow as Uits. We or the Ivestmet Compay ca joi these Uits together or divide them. There may be more tha oe series of Uits withi ay Ivestmet Fud. If so, each set will be treated as a separate Ivestmet Fud i its ow right for the purposes of valuig fuds ad workig out Uit Prices. Each Ivestmet Fud is divided ito Uits so that idividual plas ca be valued whe workig out the beefits that ca be paid. As the holdig of uits is otioal it does ot create ay iterest i the assets We treat as part of a Ivestmet Fud. 5.3 Uit-liked Ivestmet Fuds How a Ivestmet Fud is valued The value of a uit-liked Ivestmet Fud is the total value of the assets, plus icome less ay fees, held by that Ivestmet fud, as at a particular poit i time. However, the total value ca be chaged i lie with the paragraph below. The value is worked out by usig either: prices which are publicly available; or the opiio of idepedet valuers; or recogised market quotatios; or the opiio of a stockbroker or market valuer. For freehold ad leasehold property the value will be based o the most recet valuatio of the property made by a idepedet valuer. This will the be ameded to take accout of chages i property prices sice the last valuatio. Each Ivestmet Fud will bear all the costs ad expeses which are associated with it. These iclude: the costs of buyig ad sellig the assets of the fud; all expeses coected with the assets of the Fud (icludig the costs of maagemet, maiteace ad valuatio of properties, loa iterest ad ay other borrowig costs); ay charge made by a body which regulates pesios or isurace compaies; ay curret or potetial liability of the Ivestmet Fud; the gross tax otioally icurred (either directly or idirectly) by the Ivestmet Fud; ad ay loss which has happeed because of exceptioal circumstaces ad which is relevat to the Ivestmet Fud. If there are ay costs or expeses which caot be associated with a particular Ivestmet Fud, We or the Ivestmet Compay ca decide which Ivestmet Fuds the amout will be take from ad the amout to be take from each of those Ivestmet Fuds. I effect, two valuatios of each Ivestmet Fud are calculated at each valuatio poit. Oe havig regard to the prices at which the assets might be purchased ( Purchase Valuatio ) ad the other havig regard to the prices at which assets might the be sold ( Sale Valuatio ) How ofte a Uit-liked Ivestmet Fud is valued The Ivestmet Compay or We will arrage for each Uit-liked Ivestmet Fud to be valued at least oce a week. I practice, the Ivestmet Fuds will be valued more ofte; ormally each workig day How Uit Prices are worked out I order to protect the iterests of all plaholders i a Ivestmet Fud, We will calculate the Ivestmet Fud s Uit Price based o the value of the Ivestmet Fud o either a Purchase Valuatio or Sale Valuatio basis. If the Ivestmet Fud is icreasig, the Uit Price will geerally be based o a Purchase Valuatio basis. If the Ivestmet Fud is cotractig, or if We believe the Ivestmet Fud eeds to sell assets to satisfy cash-is of Uits, the a Sale Valuatio basis may be applied. 5.4 With Profits Fud The With Profits Fud works differetly from the Uit-liked Ivestmet Fuds described i sectio 5.3 above. Plas which ivest i the Frieds Life FLC With Profits fuds are etitled to a share of the profits withi this fud. The plaholders share of the profits is added to plas i the form of bouses The profits of Frieds Life Limited ad the amout to be distributed as a bous will be determied by the directors of Frieds Life Limited, takig appropriate advice. I particular, the directors will cosider all aspects likely to affect the fiacial positio of Frieds Life Limited for its log-term busiess, icludig the possible effect of potetial liabilities, should they happe, ad to the future iterests of Our with profits plaholders. Regular 14

16 ivestmet fuds bouses are ormally added to the pla at least mothly by icreasig the Uit Price. The regular bous reflects the retur that We expect to receive from the assets of the With Profits Fud, while smoothig out the rise ad fall i those returs. However, the directors ca decide whe ad how the bouses are distributed If the ivestmet performace of the With Profits Fud is lower tha that reflected i the bouses We have already added to Your pla, We may reduce the value of your Uits. This reductio is called a MVR. You ca fid out more about the MVR i Part 7 Further iformatio We ca set up more With Profits fuds, or ew bous series withi the existig With Profits Fud ad allocate Uits to these from future ivestmets resultig from: startig or icreasig regular cotributios; payig a sigle cotributio; switchig ivestmets to the With Profits Fud; startig to ivest i the With Profits Fud; ad choosig late retiremet (whether specified or uspecified). Ay of these ew With Profits Fuds or ew bous series will ormally be set up o the same terms that apply to the existig With Profits Fud ad to Uits i that fud. However, the bous rate may be differet for each of these fuds or ew bous series Frieds Life s With Profits Fuds are maaged i accordace with Our Priciples ad Practices of Fiacial Maagemet (PPFM). Whe You received Your Key Features documet You will also have bee give a copy of our Guide to how we maage our with profits busiess which summarises the iformatio provided i the PPFM. If You would like aother copy of this guide, or if You would like a copy of Our full PPFM, You ca write to Us, or You ca fid either documet o Our website at Addig Uits to a pla Uits are ormally added, uless specifically agreed with You or Your employer, to Your pla as follows: for cotributios paid by cheque, o the date the cotributio is received at Our Admiistrative Headquarters; for cotributios paid, other tha by cheque, o the date o which the cotributio is received i Our bak accout. For the first cotributio We receive uder a ew pla or for ay sigle cotributio or trasfer value, We will ot place Uits i Your pla util We have all the iformatio We eed to meet cotractual ad legal requiremets as well as the cotributio or trasfer value. 5.6 Workig out the umber of Uits to add Whe a cotributio is paid ito a pla, We work out the umber of Uits to add to the pla by: dividig the amout of the cotributio less ay Oe-off Charge; by the Uit Price o the date that We add the Uits. We will allocate Uits to the Ivestmet Fuds uder the pla i lie with the writte istructios that You have give Us. Uits i the pla may oly be held i a maximum of te Ivestmet Fuds at ay oe time. 5.7 What happes if a Ivestmet Fud is closed We, or the Ivestmet Compay, reserve the right to close a Ivestmet Fud at ay time provided We or the Ivestmet Compay believe it is reasoable to do so. This may be because: The Ivestmet Fud becomes too small or too large to be maaged effectively; Assets to match the Ivestmet Fud s aims or strategy are ot available (icludig but ot limited to where the Ivestmet Fud is liked to a Exteral Fud the closure of that Exteral Fud). The costs of maagig the Ivestmet Fud become prohibitively expesive (icludig but ot limited to the charges imposed by a Exteral Fud Maager). There are sigificat chages outside of Our cotrol (for example i fiacial markets or the ecoomy) or there are legislative or regulatory chages which mea that the Ivestmet Fud is o loger able to operate i accordace with its stated aims. The Ivestmet Fud has uderperformed over a sigificat time period. Where the Ivestmet Fud is liked to a Exteral Fud We have reasoable doubts as to the goverace of that Exteral Fud, (icludig treatig customers fairly). 15

17 ivestmet fuds A aspect of the Ivestmet Fud chages outside of Our cotrol which meas it o loger meets legislative or regulatory requiremets. There is a chage i owership or corporate structure to the Ivestmet Fud maager where this has a material adverse effect. The Ivestmet Fud maager makes a chage that does ot meet Our iteral goverace requiremets. If this happes, We will o loger accept ay further ivestmet i that Ivestmet Fud from ay source icludig trasfers uder the switchig optio. If this happes, We will give You 30 days advace otice or i the case of closure of a Ivestmet Fud that ivests i a Exteral Fud, as much otice as is reasoably practicable. However, We do ot eed to give You ay prior otice if We are simply closig the Ivestmet Fud to ew ivestmet rather tha trasferrig Uits to a ew Ivestmet Fud. We could also replace those Uits i a pla which are i the closig Ivestmet Fud. If We decide to substitute Uits We will write to those plaholders who are affected at least 30 days beforehad. I this case, You will have util the ed of this 30-day otice period to tell Us which available Ivestmet Fud You would like Us to trasfer the value of Your Uits to. If o respose is received cofirmig a alterative Ivestmet Fud to be used, withi the otice period, We will surreder all Uits that You hold i that Ivestmet Fud ad use the proceeds to purchase Uits i a Ivestmet Fud that We reasoably cosider most closely match the ivestmet objectives ad risk of the closig fud. We will deal with the trasfer i the way We describe i sectio 5.8. If We receive otice that a Exteral Fud is closig to ew ivestmet oly ad We have decided to close the Ivestmet Fud that ivests i the Exteral Fud, We will give You as much otice as possible of such closure. You will the be able to switch Your Uits i that Ivestmet Fud ito ay other Ivestmet Fud available to the pla at that time. 5.8 Optio to switch betwee Ivestmet Fuds Depedig o the rest of this sectio, You ca tell Us to replace some or all of the Uits i a particular Ivestmet Fud with Uits i ay other Ivestmet Fud or Fuds which are available to the pla. Uits uder the pla ca be allocated to a maximum of te Ivestmet Fuds at ay oe time. Your request to switch Uits betwee Ivestmet Fuds must be made i writig (or i ay other way that We may agree to). The value of the Uits to be allocated to the ew Ivestmet Fud will be the same value as the Uits beig replaced, after We have take off ay admiistratio charge. The value of the Uits will be worked out usig Uit Prices decided i lie with the ext paragraph. The value of the Uits beig replaced must be the same or more tha the miimum value which We specify from time to time. If You write to Us usig the ordiary Royal Mail postal service We will use the Uit Prices o the day after We receive the request. If We receive the request i ay other way that We allow, We will use the Uit Price o the date o later tha three workig days after We receive the request. If Uits i the With Profits Fud are beig replaced, their value may be reduced by a MVR. (Details of the MVR are i Part 7 - Further iformatio.) If Uits are beig purchased i a Ivestmet Fud to which the Oe-off Charge applies, the umber of Uits purchased will be reduced by the Oe-off Charge. You ca ormally switch Your ivestmet betwee the available Ivestmet Fuds at ay time. Curretly there is o charge for this as the cost is covered by the other charges We make. However, a Oe-off Charge is applied o the purchase of Uits i certai Ivestmet Fuds ad a market value reductio may be applied to ay Uits from the With Profits Fud which are replaced. We reserve the right to delay ay dealigs i the Ivestmet Fuds such as surreders or switches for up to oe moth (for example whe dealigs o a stock market exchage are suspeded), ad six moths for Ivestmet Fuds that ivest i property (to allow property to be sold if ecessary). I uusual or exceptioal circumstaces these periods may be exteded for as log as is ecessary ad is fair to plaholders who are ivested i the Ivestmet Fud. These circumstaces are detailed i Provisio Ay trasactios deferred will the be based o the uit price at the poit the trasactio takes place ad ot the date that it was requested. I additio to this we also reserve the right to: refuse the switch request; or delay the request idefiitely; or limit the umber of switches of Uits; ad/or impose charges for switchig of Uits, 16