RL360 Quantum Savings Plan

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Review summary

RL360 Insurance Company Quantum Savings Plan

RL360 is based in the Isle of Man, conducting business in Asia, Africa, the Middle East and the UK. RL360 is part of the RL360 Group, which has 60,000 policyholders, in 170 countries in excess of $10 billion in assets under management and 300 staff.

It is no longer part of Royal London (the UK group) separating from it several years ago.

RL360 provides offshore savings, protection and investment products for expats and local nationals around the world.

The RL360 Quantum savings plan is a core product of RL360 Insurance Company Limited (formally Royal London 360) in The Isle of Man. 

The RL360 Quantum is an offshore regular savings plan which legally contracts you to save an agreed amount on a regular basis for a pre-agreed number of years.  It should never be taken out unless you fully intend to contribute for the entire term agreed.  Here's why...

Overview

RL360 Quantum is a regular premium, whole of life, life assurance contract. It has historically been available to most international investors.

If a RL360 Quantum savings plan is surrendered within its original initial allocation period, it will have no surrender value – in effect suffering a 100% surrender charge.

Once the RL360 Quantum savings plan has completed the initial allocation period, then if the policy is surrendered in part or in full, the initial units purchased will be subject to a surrender charge.

The surrender charge applied is based on the remaining years of the premium term. In effect this means that most, if not all of the first 18 months – 2 years premiums are lost upon surrender.

There are a variety of fees and charges that apply to the plan including the Initial Unit Charge, Contract Charge, Policy Fee, External Fund Management Charge, Investment Adviser Fee and Miscellaneous Charges: all these will impact on the return you receive from the plan.

It is relatively easy for this endowment type of regular savings plan to be mis-represented.  The main area of contention is often to do with a lack of perceived flexibility and difficult to understand charging structures. 

However, clients are often also unaware that upon early full encashment most, if not indeed all, of the first 18 months – 2 years premiums are lost through surrender charges.

Simply put, this entire family of regular savings plan (known as Maximum Investment Plans) has now been superseded by other better options. A little like cassette players being replaced by iPods, the outdated construction of this plan makes it a highly unattractive for international investors who wish to maximise their return.

The pros

  • Size and administrative capability
  • Superficially highly attractive
  • Potential for better than bank rate return if all contributions are made throughout the term

The cons

  • Inflexible
  • Opaque and complex charging structure
  • Expensive way to invest
  • Easily mis-represented at the point of sale
FAQs
I want to surrender my RL360 Quantum, will there be a penalty?

RL360 Quantum is a regular premium, whole of life, life assurance contract. It has historically been available to most international investors.

If a RL360 Quantum savings plan is surrendered within its original initial allocation period, it will have no surrender value – in effect suffering a 100% surrender charge.

Once the RL360 Quantum savings plan has completed the initial allocation period, then if the policy is surrendered in part or in full, the initial units purchased will be subject to a surrender charge.

The surrender charge applied is based on the remaining years of the premium term. In effect this means that most if not all of the first 18 months – 2 years premiums are lost upon surrender.

What are the Quantum's fees and charges?

Initial unit charge: a charge of 0.50% per month will be deducted from the value of the initial units held within your policy.

This charge will be deducted in arrears throughout the premium term.

Contract charge: there is an ongoing contract charge of 0.125% of the current fund value, deducted each month in arrears.

The charge is applied proportionately across both initial and accumulation units.

Policy fee: a monthly policy fee will be deducted in arrears from the policy’s accumulation units.

This equates to £5 or currency equivalent.

Additional charges: the funds that are held within your policy will be subject to an annual management charge, typically between 0.5% and 2%.

In addition you may appoint an investment adviser, who will charge a fee of around 1%.

Can I cash in my RL360 Quantum early?

A full encashment results in penalties being applied through surrender charges linked to the term of the policy. In effect this means that on polices with an original term of more than 15 years most, if not all, of the first 18 months-2 years premiums will be lost upon surrender.

It is important to be aware that the RL360 Quantum Savings Plan is a long term savings plan, if you decided to cancel the plan early you could lose a large proportion of the money you have saved.

What are the minimum contributions and minimum and maximum terms of the Quantum?

Contract terms are from 5 to 25 years and the minimums are 5 – 9 years = £400 per month, 10 years+ = £200 per month. Or currency equivalent (accounts offered in GBP, USD, EURO, Hong Kong dollar, Japanese yen, SWISS Franc, Australian Dollar).

Customer reviews
Can anyone explain where my money has gone?

How can I have saved £1000 a month for 17 months and there be nothing left now I need to get my money out???

I was told this was totally flexible

I could increase and decrease my contributions, and after 2 years get my hands on my money - at no point did anyone ever say or even write in the acres of smallprint, that my first 2 years money would be eatn in commission for the broker who sold this to me. Nice one...no wonder IFAs get a bad name - some of them deserve it.

Expert verdict
Expert Assessment of RL 360 Insurance Company Quantum Savings Plan

More cost effective, more flexible and less complex options are now available for discerning investors.

If you already hold an RL360 Quantum savings plan and it is worth £50,000 or more, we recommend you have a free, no obligation X-Ray Review™ conducted to give you the information you need to make a decision on the best way forward.

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Jake van den Dries

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