Royal London announces signing of agreements with The Co-operative Banking Group

19th March 2013

The Co-operative Banking Group announces signing of agreements with Royal London

Royal London and The Co-operative Banking Group have today announced the signing of agreements for Royal London to acquire The Co-operative’s life insurance and asset management businesses.

Before the transaction takes place there will be a period of completion which will take a number of months. Following the completion period life insurance and asset management customers will transfer to Royal London.

Customers affected are those who have products provided by Co-operative Insurance Society (CIS), CIS Unit Managers and CIS Policyholder Services. These products include unit trusts, investments, pensions, life insurance and protection.

Questions and answers

Q1 Why Royal London?
We believe Royal London is the best solution for our life insurance and asset management businesses and for our customers. Royal London is the largest mutual life and pensions company in the UK with Group funds under management of £49.8 billion. Group businesses serve over 3.6 million customers and employ 2,910 people (figures quoted are as at 31 December 2012). It is a specialist financial services provider and its businesses operate through a number of brands.

Q2 What does this mean for me?
If you have an existing CIS life or pension product, or an investment in any of the CIS Unit Trusts, Royal London will look after your product once the sale has been completed. Your product will be administered in the same way as it is now. You do not need to do anything.

Q3 How does this affect my policy/investment?
The terms and conditions and benefits will remain the same.

Q4 Will this change affect the performance or return on my product?
The transfer will have no impact on the performance or return on your product.

Q5 I also have an existing Royal London policy/investment. How is this policy affected?
The administration and benefits of your existing Royal London policy remained unchanged.

Q6 What products are affected by this announcement?
All products provided by The Co-operative’s life insurance and asset management businesses are affected. This includes unit trusts, investments, pensions, life insurance and protection. The transfer does not affect Co-operative cash savings products or our home, motor and pet insurances.

Q7 What will happen to my home, motor or pet insurance as a result of this?
This announcement is about our life insurance and asset management businesses and not these policies. The Co-operative Bank’s general insurance business, which looks after these policies, continues to manage products in both the home and motor insurance markets.

Q8 Is the transfer to Royal London in keeping with The Co-operative Banking Groups heritage?
In selling our life insurance and asset management businesses to Royal London we believe that we are doing what is right to ensure we protect the interests of customers. Royal London is the UK’s largest mutual life and pensions company and is owned by its members, not by external shareholders which means it has a similar heritage to our own.

Q9 Does Royal London have the same approach to ethics as The Co-operative Banking Group?
Royal London is the UK’s largest mutual life and pensions company and is owned by its members, not by external shareholders which means it has a similar heritage to our own.

In selling our life insurance and asset management businesses to Royal London we believe that we are doing what is right to ensure we protect the interests of customers. In buying our asset management business Royal London will benefit from their expertise in ethical investments.

Q10 Will I still be able to top-up existing products? How do I do this?
Top-ups to certain products can be made via our contact centres for direct debit increases. Please call 08457 46 46 46 (lines are open 8am to 8pm Monday to Friday and 8am to 5pm Saturday). One off top ups should be made by post in the usual way.

Q11 Will I get a payout as a result of this transfer?
No. The fund where your product is invested remains a mutual fund and there will be no payouts as a result of the transfer to Royal London.

Q12 Who can advise me on my existing Co-operative Insurance/Investments products?
If you would like advice on your existing Co-operative products, you should contact an Independent Financial Adviser (IFA). If you don’t already have an IFA you can find details of IFAs in your area at www.searchifa.co.uk or www.ukfinancialadviser.co.uk. Royal London can’t give you advice.

Q13 How will I know how my existing policy is doing?
If you currently receive regular statements or bonus certificates then these will continue to be sent to you. If you have any other questions then you can call us on this number 08457 46 46 46 (lines are open 8am to 8pm Monday to Friday and 8am to 5pm Saturday).

Q14 How do I contact you in the future?
Nothing has changed. You can call us on the number – 08457 46 46 46 (lines are open 8am to 8pm Monday to Friday and 8am to 5pm Saturday).

Q15 Should I cancel my existing policy because of this change?
There is no need for you to do anything. The administration and benefits of your existing Co-operative products remain unchanged. If you would like advice on your existing Co-operative products, you should contact an Independent Financial Adviser (IFA). If you don’t already have an IFA you can find details of IFAs in your area at www.searchifa.co.uk or www.ukfinancialadviser.co.uk.

Q16 What is the state of the Life Fund? Are my existing products at risk?
The Life Fund remains in an extremely strong state and we expect it to remain so following the transfer to Royal London. However, in the event of a major change resulting in extreme circumstances, the Fund would benefit from capital support from Royal London.

Q17 I have products with both Co-operative Insurance Society and the Royal London Group – am I still covered under Financial Services Compensation Scheme (FSCS)
The transfer of the business to Royal London will not affect the cover you currently have for your Co-op product under FSCS.

Q18 Can my product remain with The Co-operative Banking Group instead of Royal London?
Co-operative life insurance, pension and unit trust products will not be able to remain with The Co-operative Banking Group as we will no longer be offering or administering these products.

Q19 Will Royal London make a profit from this deal at the expense of Policyholders?
Royal London is the UK’s largest mutual life and pensions company. Its size gives it the opportunity to run its business in an efficient and cost effective manner. Policyholders will benefit from this and as a result of the sale CIS will have a set of administration fees agreed with Royal London at the outset, which protects policyholders from unexpected expense increases.

Q20 I’m not happy. Where do I go for further information?
You can write to us at: Customer Feedback, The Co-operative Bank, 14th Floor, Miller Street, Manchester, M60 0AL.