A “fair value adjustment” on property values in the fund will be applied instead, the company said, which would seek to “balance the interests of policyholders who may leave the fund with the interests of those that remain”.
Canada Life said the current level of fair value adjustment, which factors in independent valuations of the property market, is -7% across all the property funds.
David Marchant, chief investment officer of Canada Life, said that commercial property investment and occupational transaction activity has been subdued in the last two months, and the market outlook remained unclear.
“Our external valuers continue to impose a caution to the accuracy of values in the lack of market transparency. However, we have been closely monitoring cash flows within the fund and, following the successful completion of two real estate sales during August, liquidity has been improved to a level which we expect can meet redemption requests and ongoing liquidity requirements”.
In August, Canada Life reassured financial advisers that clients using its life bonds can still access their money even if part of their funds are in suspended UK commercial property funds.
