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REVIEW SUMMARY

Hansard International Capital Investment Bond

Hansard International has been providing financial products and services to international clients since 1987 from their base on the Isle of Man. 

Hansard International forms part of Hansard Global plc, which has been listed on the London Stock Exchange since 2006. 

Hansard International say that they have USD 1 billion of assets under administration and provide servicing for tens of thousands of international clients.

Hansard International Limited is regulated and supervised by both the Isle of Man Financial Services Authority (IoM FSA) and the Labuan FSA (LFSA).

NOTE:

This product is no longer open to new business and has been replaced by the Universal Personal Portfolio by Hansard International. You can learn more about it our independent review of the Universal Personal Portfolio here.

Overview
FAQ
Customer Reviews
Expert Verdict

Hansard Capital Investment Bond is similar to many in the offshore market place. 

The Hansard Capital Investment Bond was designed for building up a lump sum over the medium to long term beginning with a minimum of USD 20,000 in the first three years, without the need to commit to a defined regular contribution. 

It is written on a capital redemption basis (this means there are no lives assured, so the investment does not end on death - so it can be passed down through families for Estate Planning purposes if written in trust) and is available on a single or joint ownership basis.

Features of the Hansard Capital Investment Bond:

  • The Hansard Capital Investment Bond may be denominated in US dollar, GB pound, Hong Kong dollar, Japanese yen or Euro. Benefits will be paid in the plan currency.
  • Contract holders may change the currency denomination of the contract at any time, at the exchange rate then prevailing.
  • Beginning with a minimum of USD 20,000 in the first three years.
  • It will mature on expiry of the 99 year term unless fully surrendered prior to the end of the term. At the end of the selected term, the value of the Hansard Capital Investment Bond will be the value of the portfolio.
  • Hansard Capital Investment Bond holders may make single contributions at any time subject to a minimum of USD 2,000. Regular contributions can also be made, subject to a minimum of USD 600 per month or USD 1,800 per quarter. 
  • If the minimum contracted contribution is not received by the third anniversary of the commencement of the contract, an additional charge, currently GBP 420, will be applied by cancellation of units.
  • Over 170 international funds available - with access to external equities, bonds and collectives at an additional charge.
  • If the Hansard Capital Investment Bond is used within a QROPS or SIPP there will be additional set up and ongoing fees for the life of the policy.

On the death of the life assured (or the first life assured to die in the case of a joint-lives first-death contract, or the second-life assured to die in the case of a joint-lives second-death contract) before the agreed maturity date, the standard sum assured is 101% of the value of the initial and accumulator units.

The value is calculated using the applicable bid price of units.

NOTE:

  • The product facilitates a range of charging structures linked mainly to the amount of commission being taken by your adviser of salesman.
  • A full encashment results in penalties being applied in the early years through surrender charges. In effect this means that on polices the first 5, or more typically 8 – 10, years may have quite high surrender charges imposed.
  • It would not be uncommon to see as much as 8% of the value of the plan value being lost by surrendering the Hansard Capital Investment Bond early.
  • We do NOT recommend this product for QROPS or SIPP investing and would highly recommend reading the 'expert verdict' section of this review to make an informed decision.

 

 

The Pros

> Strong brand of parent company

The Cons

> Risk of hidden commission
> No longer open to new business
> Commonly mis-used
> With commission this is an extremely expensive option
> Partial withdrawals can increase real costs
Who is eligible for Hansard's Capital Investment Bond?

Note, this product is no longer available for new business.

However, Hansard says:

Applicants must be aged 18 or over at the date of commencement. Applications cannot currently be accepted from residents of the United States of America, U.S. Persons and residents from most European Union Member States.

 
Can I surrender or withdraw from my Hansard Capital Investment Bond?

Yes you can - but you will be stung by fees and charges - as outlined below.

If you want a plain English summary of what you will have to pay, we would suggest getting a Second Opinion Review and we'll be able to break down exactly what you will pay.

Withdrawals:

Withdrawals may be made on a regular or ad hoc basis to provide an income, subject to normal withdrawal rules and charges, provided contributions totaling at least USD 20,000 have been received.

There is a charge, currently GBP 29 per withdrawal, which is waived, depending on the amount of the total contributions paid and the frequency of income payments.

Surrender and withdrawal:

Withdrawals can be made at any time, for the value of units cancelled less the balance of the year’s management charge on the amount withdrawn and the discontinuance charge - if appropriate.

The value is calculated using the applicable unit bid prices.

The minimum withdrawal at any time is USD 200.

On full surrender, the balance of the year’s annual management charge, the balance of the year’s service charge and any establishment charge due but not yet applied to the contract will be applied in addition to the discontinuance charge if appropriate.

Units relating to contributions which have been allocated for less than seven years are subject to a discontinuance charge on withdrawal or full surrender.

This charge is 7% of the value of the units if the related contribution has been allocated for less than 12 months, reducing by 1% for each complete year the related contribution has been allocated.

If only one contribution has been paid, all of the units relate to that contribution.

If subsequent contributions have been paid, the number of units related to each additional contribution is calculated by applying a factor to the total number of units (after the contribution has been applied to the contract).

The factor is equal to A/B, where A is the amount of the contribution in question and B is the total fund value immediately after that contribution has been applied.

This discontinuance charge is waived when units are sold which relate to contributions that have been allocated for between five and seven years, provided that the amount withdrawn does not exceed 10% per year of the sum of those contributions.

If the contract is fully surrendered within three years and the minimum contracted contribution has not been received, the additional charge, currently GBP 420, is applied by cancellation of units. 

Where a withdrawal takes place within that period and before the minimum total contribution has been received, if the value of the units remaining allocated to the contract after the withdrawal will be less the additional charge, the contract will be surrendered in full.

More expensive than I thought

Stand-alone, the fees - it all sounds small but when they add up it becomes really expensive.

Expert assessment of Hansard International's Capital Investment Bond

There are two major disadvantages if you hold an existing Hansard Capital Investment Bond.

Firstly, although their IT system is strong, Hansard does not have a strong reputation for dealing with licensed intermediaries.

If you are advised via one of these distributors, it is likely that the outcome you receive will be substantially different to the one you expect because of the well concealed, high product charges used to fund this adviser's commission.

Secondly, this product type is fairly inflexible and no longer open to new business. There are more cost effective, flexible products with a wider range of better investment options available for senior international professionals.

Our verdict is that this product is out of date - which probably explains why it is no longer actively marketed.

If you already have a Capital Investment Bond from Hansard, and it is worth £250,000 or more, we strongly recommend you seek a Second Opinion to ensure you are on track to get and keep the life you want.

Hansard International Capital Investment Bond Guide

Hansard International Capital Investment Bond Charges

Hansard International Brochure

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