NFU Mutual With Profits

 

RWP Research Findings, Overview and Comments

 

NFU Mutual is a traditional mutual society; making it unusual in today’s With-Profits market-place where the majority of With Profits funds are now run by shareholder owned insurers.

The NFU Mutual With Profits position is strong compared to most of the rest of the market. They are traditionally seen as one of the better companies in this sector.  As a mutual society they retain some, if not most, of the traditional hallmarks of the with-profits concept. Including for many policies guarantees on pay-outs on maturity, at a specified date or at retirement; and with some policies guaranteed rates of income in payment.

A mutual society is one where its members effectively own the business.

They generally have (comparatively) good With Profits performance, but this can vary depending on the type of policy and when it was taken out.

They also run both conventional and unitised With Profits policies; this distinction can be important as it can affect the guarantees and future prospects for policyholders to consider.

 

We assess NFU Mutual as a company easy to deal with, providing transparency and they are financially strong. However in reviewing policies for With Profits investors we see a wide mix of past performance, depending on when a policy was taken out and what type of policy it is. Some past performance is poor; some is good. Some policies have compelling reasons to hold onto them, some are clearly risky with limited reward and offer policyholders limited value. On balance we feel many NFU Mutual policies represent the better end of the market; avoiding some of the difficulties other providers have experienced.

However this should not breed complacency as with any company, your position will be dependent on a range of factors - you may be holding something solid or something flaky; we recommend if you hold a With Profits policy it should be fully reviewed on its own merits to judge how it is has performed and its future prospects.

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Company ownership position

NFU Mutual is the operating name – the formal title is The National Farmers Union Mutual Insurance Society Limited. This is a company limited by guarantee and owned by its members (“the Society”). Membership of the Society is conferred by the issue of a policy (including with-profits, non-profit and general insurance).

 

Company history

In 1910, seven farmers from the Midlands launched a scheme to entice new members to the Farmers' Union, by offering insurance at a cost price.

NFU Mutual is a national insurer with over 900,000 customers and 300 local branches nationwide.

NFU Mutual With Profits funds

There is one With Profit fund in keeping with their mutual status; this fund sits behind a variety of different product types e.g. bonds, pensions or annuities and the terms applying – and therefore the return – are dependent on the product terms and which product a policyholder has. The actual management, performance and other features of the fund and the various product types can be found by using the links below or please contact us and we can help you get all the individual information on your policy.

 

 

For the latest with-profits bonus information please click here:

http://www.nfumutual.co.uk/Global/PDFs%20-%20document%20library/Investments/SA_WPF_0215_DR4.pdf

 

For information on how NFU Mutual approach the management of their with-profits, including their current asset allocation mix and customer friendly documents on each product type please click here:

http://www.nfumutual.co.uk/personal/investments/our-funds/with-profits-funds/

 

Please remember that any of our summary findings or conclusions are general; an appraisal of the general position for that company. There will be situations where an individual policyholder with a company that is ‘good’’ may want to look at surrendering or transferring their policy (for example to secure a guarantee or because it does not suit their risk position), likewise there will be situations where policyholders with a ‘poor’ company want to stick with what they have (for example because the penalty of exiting will be too great). Nothing can replace getting a report based on your unique circumstances; it is only this unique, personalised report which will provide the information that will instruct you on your circumstances regardless of the company and our general comments.

Click here to get request more detail from us about NFU Mutual

Please note the information on these pages should not be used in any way or form as the basis for any decision about your with-profits investment or plan. RWP makes every attempt to ensure that all information is up to date and accurate but RWP cannot be held responsible for any of the detail provided. The information above is published to act as a broad guide to the Company’s position, history and future prospects. However any decision about your own with-profit plan should only be taken after you have sought and received qualified advice from an appropriate regulated advisory source and should be based entirely on that advice.