The bond is set up as a series of identical contracts (known as ‘policies’ or ‘segments’). This is designed to give clients greater choice as to how they take money from the bond and, potentially, increase the tax efficiency of the investment.

The segments are in effect multiple identical small bonds and each has an identical share of the overall value of the bond. If whole segments are cancelled to get the surrender value, this can result in a smaller chargeable gain and, potentially, a lower tax charge. Larger numbers of segments can enable clients to benefit from 'top slicing' when the gain is being calculated.

The default number of segments is 1,000, but we can issue new policies with up to 99,999 segments on request, this enables you to carry out pinpoint tax planning. Other than the investment meeting our minimum premium requirement of £50,000 and each segment being of equal value, there is no minimum value for each segment at set-up.

There are five charging structures to choose from: 

• an initial charge structure,
• a five-year establishment charge structure, 
• an eight-year establishment charge structure,
• a throughout life charge structure, and 
• an initial and ongoing charge structure.

The different options allow a client to achieve the right balance between an immediate initial charge and/or spreading the charges over a longer period of time.

We produce client valuation statements twice a year. You can also download valuation statements by registering for our online valuations service .

This enables you to have instant access to the most recent statement at any point in time (at client reviews, for example).

When clients want to take a partial withdrawal from their bond, we offer the option of encashment of full segments, or partial encashment across all segments.

• percentage of premium,
• percentage of bond value, or 
• fixed sum. 

The maximum withdrawal rate is defined by the charging structure and minimum bond value, but the choices of charging structure allow greater flexibility.

The commission structure can be adapted to accommodate both the client's needs and an adviser’s individual business model.

Trail commission (funded by maintenance charge):

We pay up to 1% renewal commission each year, available in steps of 0.01%. This is an additional charge on the bond and is paid monthly in arrears. This will be at the end of the first complete policy month, giving the adviser a regular and prompt cash flow from any bond they place with us. Other companies will pay trail commission quarterly, from the end of the first quarter, or even annually. Commission is paid through Legal & General Group and payments are made in Sterling.

Sacrifice initial commission:

Our maximum initial commission is 6%. You can sacrifice initial commission in steps of 0.25%, which may either reduce the charges applied to the bond or increase the allocation rate.

On the initial and ongoing charge version, initial commission is directly linked to the initial charge, but the ongoing charge is not.

Initial charge structure and Initial and ongoing charge structure: 

No penalties apply if the client wants to take out any or all of their money as the setting up charge has been paid up front.

Throughout life:

Surrender penalties are based on the amount of initial commission selected. The surrender penalty will exist for eight years, if full initial commission is taken.

Five and eight-year establishment charge structures: 

The charges for these structures are based on the amount of the initial premium – you will know from policy inception how much the bond will cost your client. Surrender penalties on these charging structures simply reflect any outstanding establishment charges that we have not taken (that is, if someone had an eight-year bond and needed to encash the bond at the end of year five we would still have three years of charges to collect, which we would take as surrender penalties when the client surrendered the bond).

If the client wishes to keep the bond in force we will allow them to take out as much as they need, provided £15,000 plus the value of any outstanding charges remains. If the bond value drops below this amount, we reserve the right to fully encash the bond and take any outstanding charges. It is important to note that this does not alter the amount of charges we take in total; we are simply drawing them from a reduced fund.