Guaranteed Investment Bond

It is a life assurance policy.

It is designed for people who want to invest a lump sum.

You cannot add money to your investment at a later date.

It provides a guarantee of returning your initial lump sum at any point.

If you keep your bond until the maturity date (five years after the end of the 30 day cancellation period) it will provide guaranteed growth of 4% per annum gross. The interest compounds over the term (i.e. each year interest is added to the investment and previously accrued interest) and is equivalent to an overall return of 21.66% over the five year period.

For tax purposes, it is available using a Stocks and Shares ISA route, or via a non-ISA path as a life assurance policy.

It provides a small amount of life cover. For non-ISA investments it is possible to set it up using a joint life basis.

You can access your investment at any time.

For Series 1,2 and 3 of the Bond, if you decide to cash-in your investment prior to the maturity date you will not be entitled to any growth on your plan. You would only get back your initial lump sum investment.

However, Series 4 and subsequent series offer more flexibility, allowing you to withdraw your investment at any time during the five years and you will receive interest based on the number of years invested.

At the maturity date you will be able to access your investment and obtain the growth that is attached to your policy.

After the maturity date there is no guaranteed growth provided under the product. You could leave your investment with us. We will contact you just prior to the maturity date to provide you with details of the options available to you and alternative products (where available) and we will ask you what you want to do with your investment.

You will receive a return of your premium plus interest payments detailed in the table below based on the number of years your money has been invested:

The return of your lump sum is guaranteed at any time.

If you die prior to the maturity date then:

• If you are the sole Life Assured at that time then your estate would receive a lump sum in-line with the Table below.
• If there is a second life assured under the policy, the policy will continue in the name of the surviving life assured until maturity or second death.

The table below sets out what would be paid out if you were to die during the five year term:

If you die after the maturity date, and you have left the policy invested, then:

• If you are the sole Life Assured at that time then your estate would receive your lump sum with the guaranteed growth of 21.66%, plus any non-guaranteed growth provided after the maturity date.
• If there is a second life assured under the policy, the policy would continue in the sole name of the second life. They could cash-in the policy if they wished.

There are no explicit charges in our policy. The policy terms and benefits have been designed to incorporate any charges we incur.

We believe this makes it easier for you to understand what the policy is providing.

Please note that if you should seek financial advice in relation to the Guaranteed Investment Bond then any fees or charges payable for the service provided by an adviser should be agreed between you and your adviser, and you would pay for such fees separately.

No. The way in which we have designed the Guaranteed Investment Bond, and the underlying investments we have to make, means that we need to leave our monies invested until the maturity date.

Yes, it is possible to do this provided that you do not use a Stocks and Shares ISA route to invest in the Guaranteed Investment Bond.

The money you invest is invested in our Life Fund. We use this money to invest in asset classes that enable us to provide the policy benefits, such as return of your lump sum and guaranteed growth over the term of your investment.

If you invest in the Guaranteed Investment Bond using a Stocks & Shares ISA route (up to the 2022/23 subscription limit of £20,000) then there is no tax to pay on exiting the policy. Details of how to take up this option will be supplied when we acknowledge your application.

If you do not use an ISA route, then when you exit the policy, or if you were to change the ownership of the policy:

• You won’t have to pay any capital gains tax, or basic income tax. This is because our Life Fund will have already paid tax (where appropriate).
• However, you may have to pay higher-rate or additional rate income tax depending on your circumstances.

You need to consider any tax liability you may incur.

We have based this information on our understanding of current UK law and HM Revenue & Customs practice. Future changes in law and tax practice or in individual circumstances could affect the amount of tax you pay.

You may wish to speak to a financial adviser to find out how tax may affect your investment.

After you invest we will send you a cancellation form. You have 30 days in which to consider this, and if you change your mind about your investment within this period we will cancel your policy and return your lump sum.

After 30 days you cannot cancel your policy, but you can cash it in. Please see the section “Can I cash-in my Guaranteed Investment Bond” above (Q.4).

The growth is guaranteed from the outset. Your Certificate of Investment will detail the amount of growth you will receive. 

The growth is added after the five year Term has been completed, and not on a yearly basis. as a result we do not issue annual statements.

We will write to you prior to the maturity date when the full amount of your guaranteed growth will become available.

If you wish to complain about any aspect of the service you have received, please contact Unity Mutual, Oddfellows House, 184-186 Deansgate, Manchester, M3 3WB.

Further information on how to make a complaint can be found here.

If your complaint is not dealt with to your satisfaction, you can then complain to the Financial Ombudsman Service, South Quay Plaza, 183 Marsh Wall, London E14 9SR. Telephone 0845 080 1800. Web: www.financial-ombudsman.org.uk

Making a complaint will not prejudice your right to take legal proceedings.

We are covered by the Financial Services Compensation Scheme (FSCS). If we cannot meet our obligations, you may be entitled to compensation under the scheme.

Circumstances vary, but as this product is categorised as a long-term insurance product under the compensation scheme, it means you are covered for 100% of the claim with no upper limit for the claim amount in the unlikely event Unity Mutual default.   

Further information on the scheme, the amounts covered and how it can be obtained from the FSCS, can be found at www.fscs.org.uk. or by calling Tel: 0800 678 1100.