I've spent over twenty years sitting across the table from international professionals who were sold an offshore savings plan early in their career abroad.
Most didn't choose it.
It was recommended to them, often by the only adviser they'd ever met, and they signed because it sounded sensible: save regularly, build a pot for the future, do it in a tax efficient wrapper.
The product itself isn't the problem.
The problem is that the offshore savings plan market hasn't moved much in thirty years, while everything around it has.
If you're holding one of these plans and wondering whether it's still the right call, you're asking the right question. Here's what an offshore savings plan actually is, why it was built the way it was, and why so many international professionals are now reviewing theirs.
An offshore savings plan is a regular premium, unit-linked investment policy sold through an offshore life insurance company, usually based in Guernsey, the Isle of Man or a similar jurisdiction.
You commit to paying a fixed amount each month for an agreed term, often ten, fifteen or twenty-five years. Part of each premium buys units in funds you select, and part covers the policy's charges and the adviser's commission.
It's marketed as a disciplined way to save and invest while living and working abroad, wrapped in a structure that can offer tax deferral depending on where you're resident.
For decades it was one of the only products an offshore adviser could offer an expat with no access to a workplace pension or domestic investment platform.
If you have a long memory, the structure will sound familiar. It's a direct descendant of the Maximum Investment Plan, or MIP, sold across the UK in the 1980s. The MIP was a unit-linked endowment policy: a fixed-term contract where part of each premium went towards life cover and the rest into investment funds, paying out a lump sum at the end of the term.
It was a genuinely new idea at the time. It was also, in time, a genuinely damaging one. High commission rates baked into the charging structure, opaque costs that were never clearly disclosed, and high-pressure sales tactics led to widespread allegations of mis-selling.
The UK's broader personal pension mis-selling scandal of the same era saw an estimated two million people wrongly advised to leave secure occupational pensions for commission-driven personal pensions, a scandal that ran in parallel with the MIP's troubles and shaped how UK regulators eventually treated commission-led products. The MIP itself was effectively phased out in the UK in the early 1990s.
It didn't disappear. It moved offshore, and it was relaunched under new names: contractual savings plan, offshore pension, offshore savings plan, regular savings account.
The structure barely changed. The commission-led charging model, the long fixed terms, the harsh penalties for stopping early, these all carried over largely intact into the products sold to expats from the 1990s onward.
Long-term saving for your children's education or your own retirement is one of the most important financial decisions you'll make as an expat, and most of the strategies sold to international professionals are still built on a thirty-year-old model.
The core issue isn't malice. It's that the offshore advice market is dominated by salespeople paid on commission, and expats, often new to a country, new to its tax rules and short on local financial connections, rarely have the time or the network to properly research what they're being sold.
That imbalance of information and trust is where the damage happens.
You trust the adviser because they're the only one you know. You don't ask enough questions, because you don't know which questions to ask. By the time the annual statement reveals the real effect of the charges, you're several years into a term that's expensive to exit.
This is the question that matters most, and it's rarely answered clearly at the point of sale. Offshore savings plans typically combine an initial charge period, where a significant share of your early premiums goes towards commission rather than investment, with an ongoing annual management charge layered on top of fund-level fees.
Combined annual costs on older-style plans commonly land well above what you'd pay on a modern investment platform.
The bigger cost is compounding.
A four per cent annual charge doesn't sound dramatic on its own, but over twenty years it can erode a third or more of what your money would otherwise have grown to versus a low-cost structure.
Run the comparison side by side over two decades and the gap between a high-charge plan and a low-cost platform is rarely a rounding error. It's frequently the difference between a comfortable retirement and a tight one.
This is usually the part nobody explained properly at the start. Most offshore savings plans are built around a fixed term, and the charging structure is front-loaded so the insurer and the adviser recoup their commission early, regardless of how the plan performs.
Stop paying or try to cash in before the end of that term and you'll typically face a surrender penalty, sometimes as high as the full value of your early units in the first year or two, gradually reducing the further you are into the term.
If you're sitting on one of these plans today, that penalty is the real decision point. It's not a reason to assume you're stuck. It's a reason to work out, properly, whether continuing to pay into a high-charge structure costs you more over the remaining term than taking the exit hit now and reinvesting in something better.
The major providers in this space have consolidated significantly over the past decade, though the underlying product design hasn't moved much.
Friends Provident International, Hansard International, RL360 and Zurich International remain active in the regular premium space.
Generali Worldwide, a name many expats will still have on their original policy documents, was acquired by the Utmost Group in 2019 and rebranded as Utmost Worldwide, now operating under the wider Utmost International umbrella. If your statements still reference Generali, that's why the name on your annual review letter has changed.
Across the board, the same pattern tends to hold: high entry and exit costs, a limited fund range compared to an open-architecture platform, fixed terms that don't flex with your life, and commission structures that reward the adviser for the sale rather than for your outcome.
None of this makes these providers illegitimate insurers. It means the product category they built decades ago hasn't kept pace with what's now available.
The investing world has moved a long way since the regular savings plan was the only option on the table.
Open-architecture investment platforms now give access to thousands of funds rather than a restricted panel chosen by the insurer. Costs have come down sharply as the industry has digitised. And critically, there's no longer a need to lock yourself into a fixed term to get the discipline of regular saving. You can build the same habit, monthly contributions, automatic investing, a long-term plan, without the penalty clause.
It's the same shift you've seen everywhere else. The products that made sense when there was no alternative get replaced once a better alternative exists.
Nobody's defending a Nokia 3310 anymore. The offshore savings plan deserves the same honest reassessment.
First, know you're not unusual. Tens of thousands of international professionals are still sold these plans every year, and a great many more are sitting on legacy policies taken out a decade or more ago. The product may well have been the right, or only, option available to you at the time.
That doesn't mean it's still the right option today.
The honest answer depends entirely on your specific plan: how far through the term you are, what the exit penalty actually looks like in pounds and pence, how the underlying funds have performed, and what you're trying to achieve with the money.
There's no universal verdict that applies to every offshore savings plan, which is exactly why a proper review matters more than a generic opinion.
AES offers an independent expert review for anyone with £1,000,000 or more saved or invested, looking specifically at whether your current arrangement is still serving you: the real cost of staying versus the real cost of leaving, the available alternatives, and whether change is actually worth it once every number is accounted for.
Sometimes the answer is to stay put.
Often it isn't.
Either way, you should be making that decision with the full picture in front of you, not the partial one you were given at the point of sale.
Offshore savings plans aren't a scam, and not every adviser who sells them is acting in bad faith. But the category was built for a market that no longer exists, one where there was no real alternative to a high-charge, fixed-term, commission-funded structure.
That market has moved on. If you took out your plan more than a few years ago, it's worth finding out, properly, whether it's still the best place for your money or whether you're paying a legacy price for a legacy product.
As with most things involving capital at risk, the right answer depends on your full circumstances, and your capital is at risk regardless of which structure you choose.
If you'd like to talk through your offshore savings plan and what your options actually look like, book a 15-minute discovery call.