What is a unit linked fund?

A Unit Linked fund is an investment fund that is divided into a number of equal units. The value, or price, of the units depends on the value of the investments that make up the investment fund, such as shares, bonds, property and cash.

When policyholders put money into their investment, they buy units from the company.

There are two types of units

'Capital' This type of unit tends to be used during the early years of a policy but not exclusively, for example, an increase in a policy’s premium/ contribution. Your premiums or pension contributions buy capital units and after a specified period, there is a switch from capital to accumulation units. The annual management charge tends to be higher for capital units.


'Accumulation' Typically accumulation units are purchased for regular contributions, from year two or three onward, and for all one-off lump sum payments. The ongoing policy charges are paid for by cashing-in units.

as shown on your Annual Statement. Each unit type has its own value. Your policy value comes from adding together the value of both the Capital and Accumulation units.

When policyholders withdraw money from the fund, they sell their units back to the company. For more information about Unit Linked funds and how they work, click here.

To find out more about your particular policy fund, click here.

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