This calculator projects a policyholder’s unit-linked savings fund, according to the amount and profile of the payments, the charges applied, fund growth and any expenses or commission. It also calculates the discounted profit for the provider, based on the above cashflows into the non-unit fund and whether any reserving allowance is applied.
Payments
Regular premium
Single premium
Premium Frequency
Projection Basis
Projection Period (months)
Risk Discount Rate
Unit Fund Growth
Allow Reserves?
Non-Unit Fund Growth
Charges
Initial Allocation Rate
Bid/Offer Spread
Fund Management Charge (%)
Policy Fee (£)
Expenses and Commission
Initial Expense (£)
Initial Commission (% of premium)
Renewal Expense (£)
Renewal Commission (% of premium)
Assumptions
Commission is borne by the policyholder directly (post-RDR world) and is taken from the premiums straight away. Initial commission is taken from any premiums paid in the first month, renewal commission is taken from premiums paid thereafter.
After commission but still at the beginning of the month, premiums, allocation charges and policy fees are then processed.
The fund management charge is taken at the end of the month.
Charges to the unit fund are paid monthly by dividing the annual charge by 12, except for the policy fee which is taken annually in advance.
Expenses are paid yearly by the provider on the policy anniversary.
The regular payment commences immediately from the first month.
Reserves (if applicable) are set up to eliminate future negative cashflows from the non-unit fund.
Mortality and lapse are ignored.
The policy fee is capped by the fund value.
The only policyholder benefit payable is the full unit fund value.
Projected values
Projected Fund Value
Projected Discounted Profit
Unit Fund Table
t
Fund size at start
Payment
Commission
Allocated
Policy fee
Fund size before growth
Fund size after growth
AMC
Fund size at end
Non-Unit Fund Table
t
Allocation
AMC
Policy fee
Expenses
Profit
Profit signature
This tool has been developed by APR LLP. All figures are for illustrative purposes only.
