24 August 2019

Principles and Practices of Financial Management

How we manage our with-profits funds

We have produced with-profits guides to explain the main points about how we currently manage our with-profits funds for different types of with-profits policy. The guides cover the key points from the detailed technical guides called the Principles and Practices of Financial Management (PPFM) documents, but are not replacements for them. Please see the PPFMs for a fuller description of how we manage our with-profits funds.

Principles and Practices of Financial Management (PPFM)

The principles and practices of financial management (PPFM) are the standards we apply to the management of our with-profits business.

Principles

The principles of financial management are the high-level standards we follow when managing a with-profits fund. They describe how we will meet our duties to investors in a with-profits fund and how we will respond to changes in the business and economic environment in the longer term.

We do not expect these principles to change often. However, if we intend to change any of the principles, we will normally tell investors, in writing, at least three months before the proposed changes come into force. In certain circumstances, we may be able to obtain from our regulator, the Financial Conduct Authority, permission to notify investors in a different way or with a shorter notice period.

Practices

The practices of financial management are the detailed methods that we use to ensure that we meet the principles. They represent the current approach we use to manage a with-profits fund and to respond to changes in the business and economic environment in the shorter term.

As a result, the practices may change as our circumstances, financial management techniques, the business and regulatory environment and other factors change. We will tell investors, in writing or by some other means approved by the Financial Conduct Authority, about any changes we make to the practices. We may do this, for example, by including such information with investors' next yearly, or half-yearly, statements after the changes have been made.

Read our annual report on how we have complied with our PPFMs

The following table shows the with-profits guides and PPFM for different types of with-profits policy.

Policy type With-Profits Guide Last Updated CIS Fund PPFM Last Updated
Endowment Assurance including Low Cost Endowment (Mortgage Endowment) Assurance policies Endowment Guide December 2016
OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Free Standing Additional Voluntary Contribution (FSAVC) policies Personal Pension and SERPS Guide December 2016 OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Funeral Investment & Funeral Pre-Payment plans Funeral Investment Guide December 2016
OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Individual Personal Pension Individual Personal Pension Guide December 2016 With-Profits Pension Fund RLCIS With Profits Pension Fund PPFM December 2016
Insured Pensions – Individual Arrangements & Group Money Purchase plans Insured Pensions (Individual) Guide December 2016 OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Insured Pensions – Group Defined Benefit Schemes Insured Pensions (Group) Guide December 2016 OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Option 32 Pension Transfer policies Option 32 Guide December 2016 OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Pensions Annuity policies (Table P) Table P Guide December 2016 OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Pensions Extra (traditional with-profits AVCs) plans Pensions Guide December 2016 OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Personal Pension including SERPS Rebate policies Personal Pension and SERPS Guide December 2016 OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Platinum Bond Plus policies Platinum Products Guide December 2016
OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Platinum Plus policies Platinum Products Guide December 2016
OB & IB Fund RLCIS OB & IB Fund PPFM December 2016
Stakeholder Pension plans Stakeholder Pension Guide December 2016 With-Profits Stakeholder Fund RLCIS With Profits Stakeholder Fund PPFM December 2016
Unitised With-Profits Pension plans (other than Individual Personal Pension & Stakeholder Pension plans) Unitised With-profits Pension Plans December 2016 With-Profits Pension Fund RLCIS With Profits Pension Fund PPFM December 2016
Whole Life Assurance policies Whole Life Guide December 2016 OB & IB Fund RLCIS OB & IB Fund PPFM December 2016

Terms of reference

The With-Profits Committee: The Committee carries out the regulatory role as specified in FCA rules including providing independent opinion and oversight on matters that affect with-profits policyholders and provides its opinion to the Board on setting and changing the criteria for exercising discretion in relation to the With-Profits business.

From 30 December 2014, the Royal London With Profits Committee has taken over the responsibilities of the RL(CIS) With Profits Committee.

Download the Terms of Reference (PDF 0.1MB)

About the Royal London Group | Legal Information | Modern Slavery Statement

The Royal London Mutual Insurance Society Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England and Wales number 99064. Registered office: 55 Gracechurch Street, London, EC3V 0RL. RL Marketing (CIS) Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales number 3390839. Registered office: 55 Gracechurch Street, London, EC3V 0RL. RLUM Limited is authorised and regulated by the Financial Conduct Authority. Registered in

England and Wales number 2369965. Registered office: 55 Gracechurch Street, London, EC3V 0RL.

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