UK: Norwich Union extends with-profits five-year money-back guarantee

 Guarantee proves popular with customers and advisors

Norwich Union is extending its five-year money-back guarantee on all new With-Profit Fund investments in the Portfolio investment bond.

The offer was originally set to close on 31 December 2004 but will now be extended to 6 February 2005. The guarantee has been extended because it has proved popular with IFAs and customers and demand for guarantees remains strong.

This feature guarantees to return a policyholder’s original investment on the policy’s fifth anniversary regardless of investment conditions. The extension also applies to offshore with-profits investments in the Norwich Union International Core Funds Bond and Norwich Union International With-Profit Bond.

In addition to the five-year guarantee of return of original investment, an extra 1% allocation will continue to be offered on all new investments in Portfolio bond. Exit penalties in the first three years will also be increased by 1% during the period it applies.

Neil Davies, head of investment at Norwich Union, said: "The five-year money-back guarantee is proving popular with our customers and their IFAs. Many of our customers still have a cautious attitude to risk and, while they like the idea of having some exposure to the stock market, capital security is a concern. We believe this guarantee will provide them with the reassurance they need. The combination of the special allocation terms and money-back guarantee make Portfolio look very attractive."

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Press office contacts:
David Gwyer 01904 452828 Out of hours 07800 699508
Rob Pell 01904 452659 Out of hours 07800 699563
Louise Soulsby 01904 452617 Out of hours 07800 699526
James Evans 01904 452791 Out of hours 07800 699525

Notes to editors:

• Norwich Union is the UK’s largest insurer. It is a leading provider of life, pensions and investment products and one of the leading IFA providers. IFAs provide around 70% of the company’s long-term savings business
• Norwich Union has strategic alliances with building societies and other leading UK brand names including Tesco Personal Finance and The Royal Bank of Scotland Group
• Norwich Union’s news releases and a selection of images are available from Aviva's internet press centre at www.aviva.com/media.

About the Portfolio five-year money-back guarantee

• The five-year guarantee will apply to investments held continuously in the With-Profit Fund for five years that are fully withdrawn on, or within two weeks after, the 5^th anniversary. A penalty will be incurred if money is withdrawn from the fund before the 5^th anniversary
• The guarantee does not apply to the With-Profit Income Fund, or to switches into the fund
• If any money is taken out of the fund before the fifth or tenth anniversary through regular withdrawals, one-off withdrawals or switches into other funds, then the amount guaranteed will be reduced in proportion to the number of units cancelled. Any units cancelled to meet charges will not reduce the guarantee
• This guarantee does not apply to units added after the start date of the bond e.g. by way of switches into the With-Profit Fund
• Norwich Union reserves the right to withdraw or amend this offer at any time without notice.

About the Norwich Union Portfolio investment bond

• Portfolio is Norwich Union’s investment bond. It offers a flexible way to invest for growth or income. Portfolio’s minimum investment is Ł5,000 and investors can choose to put their money in a selection of, with-profit, equity, bond, property, distribution, and cash funds.

Portfolio also:

• Offers valuable guarantees - for investments into the With-Profit Fund, there is a 5^th and 10th anniversary money-back guarantee. The 5-year money-back guarantee is a special offer that can be removed at any time. On the Guaranteed Fund, there is a money-back guarantee on the 5th anniversary
• Is flexible - offering a wide choice of internal and external funds and a choice of two charging structures within a single bond3
• Offers a wide range of funds –investors have the choice of income and growth funds. They can choose from a range of 31 internal funds and 51 external funds managed by 12 industry-renowned fund managers such as Invesco Perpetual, Merrill Lynch, Schroders and Threadneedle. The external funds include three funds of funds managed by IMS Ltd.