Guarantees
What's different about our guarantees?
The idea of guarantees is not new, but ours are different. Traditional guarantees protect capital by limiting exposure to equities, which restricts the growth potential. MetLife's guarantees enable your clients to benefit from growth potential by allowing them to choose their level of exposure to equities. By using derivatives as an insurance policy against market falls, your client's original investment or income is secure and over time clients can lock in earlier gains, so increasing the guaranteed amount.
When a client takes up the capital guarantee, the initial amount invested in the bond is referred to as the 'Secure Capital Value' - this is the amount your client is guaranteed to get back, providing they've made no withdrawals and irrespective of stock market conditions or performance. The guarantee runs for any term between 8 and 20 years.
Current tax rules allow clients to take up to 5% from their investment in the form of a tax-deferred annual withdrawal - a shrewd way to take an 'income' without having any immediate tax to pay. But what happens if the investment value falls and the investment runs out of money? The answer is it makes no difference! The MetLife Guaranteed Investment Bond allows clients to take up to 5% of their original investment, every year for 20 years, regardless of the fund's current value.
If your clients would like to receive a guaranteed minimum income for the rest of their life, they can exercise our Secure Income Option and also lock in the returns their investment makes through our periodical Secure Capital Reviews. Reviews can occur on either a 12-monthly basis, in which case gains are capped at 10%, or every 2 1/2 years, where gains are not subject to capping.
When used in conjunction with one of our trusts, a MetLife guarantee can substantially enhance the death benefit payable on a client's bond - a feature which makes them ideal for Inheritance Tax planning purposes.
