Under the spotlight: product review of RL360° Quantum

By Brian O'Neill

Added 19th August 2016

In the first of a new series of three independent reviews of international life products, Brian O’Neill, consultant at Isle of Man-based actuary and consultancy firm Boal & Co, puts the spotlight on RL360°'s regular savings product called Quantum.

Under the spotlight: product review of RL360° Quantum

Boal & Co has for a number of years collated the sales statistics from numerous life companies, and for this product review series O’Neill picked three products that stood out as having high sales in particular markets.

When RL360° (formerly Royal London 360°) came into the market back in 2009 it had a strategic vision to increase its share of regular premium business. By the end of 2015 it had seen average annual growth in regular savings new business of 43%. One of the main drivers behind this growth appears to have been the introduction of the Quantum savings plan, aided by its entry into new territories such as Latin America.

The following product review aims to discover why many advisers have been choosing Quantum and RL360° for their client’s regular savings in certain markets.

Quantum is a regular premium offshore savings policy offered by RL360° in the Isle of Man. With initial premium levels as low as £200 per month for a 10 year term, Quantum provides an investment option for even the modest investor. Some features of the product are:

  • Both life assurance and capital redemption options are available
  • Available in seven currencies
  • Free online fund switching and no limit on the number of funds due to a low minimum fund holding
  • Investors can take premium holidays for up to two years
  • Policy segmentation of up to 100 policies

Subject to the premium size, Quantum offers up to 102% allocation throughout the lifetime of the policy, which differs to other products that only offer increased allocation rates for an initial periods. By offering the increased allocation on all premiums paid after the initial period, this is giving clients increased value to their “accumulation” units, which aren’t subject to early surrender penalties.

There is also the option of up to an additional 612% allocation on your first premium payment, depending on the term and premium value chosen, although this additional allocation will not count towards the surrender value of the policy if it is surrendered in the first five years.

The charges applicable on the product are typical of those in the market:

  • Initial unit charge of 0.5% per month of the “initial” unit value
  • £5 (or currency equivalent) per month policy fee
  • Annual charge of 1.5% of fund value, taken monthly

The majority of the products on the market have similar charges to this, so it is in the features and benefits of products where companies are trying to win a client base.

One feature that allows Quantum to stand out from its competitors are the investment options available. Moving away from the traditional route of “mirror” funds, Quantum offers direct investment in a restricted range of collective investments from some of the world’s leading fund houses. The number of investments that can be held is unlimited, provided a low minimum amount of £25 is invested in each fund chosen.

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Projection figures

Gordon, for this review we have used a savings term (10 years) that we felt was achievable for most people being introduced to this type of product, and therefore focused on the final values at the end of the term. Our LifeBase comparison tool generates both surrender values and fund values, and we should also point out that whilst we haven’t provided surrender values in this article, RL360° and the other product providers would provide this in their client illustrations.

Posted by: Brian O'Neill, 25 Aug 2016

returns are misleading

Why dont you quote redemption value, as this is what you will get. Not the fund value. This always confuses clients, they see a number of say USD31,000 and when they redeem they are surprised to only receive 1,300.

Posted by: gordon, 21 Aug 2016

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