Level Plan Bonus: Overview

Bonus rates are announced in December.

Bonus rates are not expected, necessarily, to remain at constant levels from year to year. The bonus is determined having regard to the long term expected increase in the surplus of the fund.  The surplus is influenced by the performance of the assets, the yields on the bonds matched to meet the guarantees to the policyholders and changes in life expectancy.  There is an added aim to smooth out the bonuses from year to year in order to endeavour to generate a steady return.  However, the declared bonus rates may not keep up with inflation.  The bonus target may change over time.

The bonus rates are ratified each year following the results of the annual actuarial valuation.