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Review_ Offshore Savings Plans

Offshore Savings Plans

Investors Trust Evolution Savings Plan

An independent review of the Investors Trust Evolution Savings Plan by our team of experts

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Summary

The Investors Trust Evolution Savings Plan, launched in 2002, is a contractual, regular-premium savings plan, issued as investment-linked insurance by Investors Trust Assurance SPC from the Cayman Islands and regulated by the Cayman Islands Monetary Authority.

It comes in three versions, Evolution, Evolution Plus and Evolution Select, with terms of 5 to 25 years, a choice of US dollar, euro and sterling, access to a wide range of fund managers, and loyalty bonuses and extra allocations for savers who maintain contributions.

Minimum contributions range from around USD 1,200 to USD 12,000 a year depending on the version, and charging, surrender terms and flexibility differ markedly between the three.

Pros

  • Easy online administration (top-ups, withdrawals)

  • Borrowing facility (though expensive)

  • Tax-efficient jurisdiction (useful for expats in low or no-CGT locations)

Cons

  • Not available to US citizens

  • Advisers can load high commission (creating lock-in and surrender penalties)

  • Easily mis-sold

Our verdict

The Investors Trust Evolution Savings Plan is a contractual, regular-premium savings plan, issued as investment-linked insurance from the Cayman Islands. It comes in three versions, Evolution, Evolution Plus and Evolution Select, and is more flexible than some plans of its type: the Plus and Select versions carry lower or no surrender penalties, partial withdrawals are possible, and there is a reasonable choice of currencies, terms and funds. That relative flexibility is why it rates a little higher than its peers.

The reservations are familiar, though. The standard Evolution version still applies a surrender charge equal to the administration charges due for the remaining term, which is a real lock-in. Charging is layered and not always transparent. And the biggest risk is not the product itself but how it is sold: advisers can load high commission into these plans, and it is that commission which drives the long lock-in periods and steep early-exit penalties that catch people out. The plan is also not available to US citizens.

Even at its best, it has been overtaken by cheaper, more flexible and simpler ways to invest regularly. If you take one out, do so only if you are confident you can maintain the contributions for the full term.

If you already hold an Evolution plan and it is worth around GBP 500,000 or more, a no-obligation Second Opinion will show whether it still serves you; there are often real benefits to moving even after surrender charges.

FAQs

  • Are there early encashment or withdrawal penalties for the Evolution Savings Plan?

    • On the standard Evolution version, the early surrender charge equals the administration charges due for the remaining contract years, which can be substantial. The Plus and Select versions have lower or no surrender charges. Free partial withdrawals are allowed after the initial period, subject to keeping a minimum surrender value.