1. UK Wealth Management & Development Consultants guide to business from 31.12.2012

2. Contents Skandia International’s New Proposition
The new Portfolio Bonds – Improvements
Wealth Interactive
Writing Business from 31 Dec 2012
Additional Information
Marketing materials
Coming Soon – New Features

3. Skandia International’s New Proposition

4. The New Proposition From 31 Dec 12 we will have:
A new range of UK RDR-compliant Portfolio Bonds for retail clients
International Portfolio Bond – Life from RSLAL
International Portfolio Bond – Redemption from RSLAL
European Portfolio Bond – Life from SLIL
Wealth Interactive (WI)
Our new online wealth management service for advisers and clients

5. The new Portfolio Bonds – improvements
Feature
Improvement
Benefit
Regular withdrawals
More withdrawal frequency options
Now £400 for all frequencies (was £500)
Greater choice and flexibility; monthly withdrawals on £100k investment can now align with 5% limit.
Individual policy value
Now £400 (was £2,500)
Allows greater flexibility on policy cluster size and withdrawals
Product minimum deal size
Now £400 (was £2,500) (but if asset provider minimum higher this applies)
Aligns with withdrawal/IPS limit; supports model portfolio construction
Overdraft management
Option to select asset which will be automatically sold to clear OD
Removes need for client to actively manage this issue/leave (unproductive) cash in Transaction Account.
Policy cluster functionality
Flex cluster size up or down from default of 12
Improves financial planning opportunities including assignments
Adviser Charging
New matrix of charges and advice fee options
Rebates
Full rebate paid in to the customer’s Transaction Account
Matches competitors; improves transparency
Assignments
Assignment process easier and quicker. Assigned policies can be managed independently – separate investment approach and withdrawals .

6. The new RDR matrix
A UK RDR specific matrix operates from for the new Portfolio Bond products. The new charging structure codes will be available by the To view the UK RDR matrix go to
The pre range of products sold in the UK (e.g. CIB/CRB) and open to new business until 5th April and top-ups will be processed using the existing matrix charging structure. To see our approach to ‘Pipeline & Legacy commission’, go to
Products sold outside the UK are unaffected and can continue to use the current matrix of charges

7. The new RDR matrix
At launch the matrix will only offer a choice of initial charge or a management charge based on the higher of premium or fund value (HPF). Key points to note about this matrix are:
Adviser charging: Charge packages detail Skandia’s charges only – there is no in-built loading for adviser remuneration. Any adviser fees we are asked to facilitate will be taken by an additional (adviser) charge
Minimum premiums: Each charge package has a minimum premium defined in all bond currencies. Where this equals the product minimum of £25,000, the charge package can be used for all business. Conversely, where the minimum is set at a higher level, it will not be possible to use this code for any cases below this figure.
Administration charge and dealing charge: Both of these fixed charges are defined in all bond currencies. This means that if the bond currency is € the charge will be shown and deducted in € without the need to convert to a sterling amount as is the case today
Special deals.
With the introduction of the RDR we anticipate setting up only a small number of special deals because commission will no longer be a factor in a product’s charge structure. Advisers will be agreeing their remuneration directly with clients
In the first instance a request for a special deal should be referred to your Offshore Specialist.

8. The new RDR matrix – Charge package codes
Each of our standard charge packages will have a unique 6 digit reference number (‘charge package code’) which is needed for illustrations and new business applications
Illustrations
All illustrations require a code to be input as part of the process. This retrieves the associated charge package and reflects this in the illustration
Applications
Online applications: A charge package code is input as part of the online application process. Entering the code means the relevant details will be shown during that process. These will also be shown in the application summary that is sent to the client for approval or is sent to the client at policy issue
Paper applications: The code is entered on the application form (as it is today). The details will be shown in the charge schedule which is sent to the client when the policy is issued.
Existing codes will not work for Portfolio bond business
Special deal codes: Whist a standard charge package code can be used by any adviser, a special deal code is specific to the advisory firm and will not work if used by another firm.
You agree with your advisers which of our standard packages they will use and then provide the relevant code.

9. Adviser Charging
The new Portfolio Bonds offer a range of adviser charging options for both initial and ongoing fees
Full information on these options, including those relating to trusts, can be found in the new adviser guide “about the Skandia International UK portfolio bond range - guide for UK financial advisers only” on the Sales Hub. Please click on the following link to view the new adviser guide
To know more about facilitating fees for trust business, please refer to the article “Trusts and facilitation of fees”.

10. Wealth Interactive
Wealth Interactive is our new, innovative end-to-end wealth management service
A new way of working with us that’s faster, easier, more convenient
Powering new Portfolio Bonds from Royal Skandia and Skandia Ireland, plus in 2013  all of our existing offshore portfolio bonds

11. Wealth Interactive – Adviser services
Area
Service
Adviser business
Self-management of firm’s users, including access levels
Manage firm details, including address and commission bank account details
Commission statements and other firm documentation
Adviser dashboard – configurable business monitoring data and quick access to key information
Alerts – pro-active delivery of key information, with ability to configure own alerts within set criteria
Advice process
Pre and Post-Sale illustrations and existing business illustrations
Customer set up and approval – for individual/individual trust applications only
New business and top-up applications – for individual/individual trust applications only

12. Wealth Interactive – Adviser services (cont’d)
Area
Service
Investment process
Asset research, powered by Morning Star data
Risk profiling and asset allocation tools
Portfolio building and linking policies to portfolios
Automatic re-balancing of linked portfolios
Dealing
Client-related
Track transaction progress
Transaction history
Valuations
Customer Documentation Library

13. Wealth Interactive – Client services
Area
Service
Home page
Customer dashboard – access to latest activity, quick access to “What I want to do”, application/deal approval, help and guides to what I can do on this site.
Services
Management of personal details including address & bank account details
Management of policy details (withdrawals, income management, charge management, full surrender
Dealing
Alerts covering key information and transactions
Valuations (and historical quarterly valuations)
View transaction progress
Correspondence history
Response to corporate actions
Secure document library

14. Wealth Interactive - Roll-out
WI offers significant benefits both for our clients and advisers and for our business and it is vital that we engage our advisers to adopt it as soon as we can
We know that we cannot roll out WI to all our advisers ‘overnight’, we need to build their awareness and gain their agreement to WI being set up in their businesses. After which we’ll need to build their use of its new business and servicing capabilities
Our approach to the UK market recognises this –
Our UK Online Adoption Technicians are being trained on the new services so they can actively support you and your advisers
Advisers can obtain illustrations and submit applications to us whether or not WI is set up in their business
Advisers who are not set up on WI can submit applications from individuals by paper. As advisers are set up and become familiar with WI we expect online applications to become the norm
Corporate and Trustee applications cannot be submitted online so will be paper based

15. WI Adviser Registration
Setting up a firm on WI is a straightforward process that we support and deliver through our team of OATS. They can work with a firm to set up their firm structure (views and permissions), deliver training and provide ongoing support.
To access WI, an advisory firm must have signed:
Terms of Business with Skandia International*
WI’s Master User Agreement
The next slide outlines the process followed for both ‘new’ and ‘existing’ firms. New firms do not currently have Terms of Business with Skandia International, existing firms do.
IMPORTANT
*Terms of business may already exist with Skandia International. If this is the case, existing Skandia International accounts only need to complete the Master User registration form (required as we don’t currently hold this information on our systems).

16. WI Adviser Registration
New firms - Signed Terms of Business & Master User Agreement sent to IoM
Adviser firm set-up on WI. Master User sent registration .
Master User sets firm
users up after agreeing firm permissions with OAT*
Firm live on WI online. Can submit and manage business.
On-going training and support from OAT.
Existing firms Signed Master User Agreement sent to IoM
IMPORTANT
*It is important that each firm is set-up with the correct access levels and permissions from the outset to prevent complications later on. The Online Adoption Team are best placed to agree the most appropriate firm structure and access levels dependent on each firms requirements.

17. Writing business from 31 December 2012

18. Illustrations
New business illustrations will be available from 31 Dec 2012 with existing business & fee change illustrations being made available later.
Advisers who are registered for WI can produce their own online illustrations.
Client details can either be pulled through using the client’s customer where that client is already set up on WI, or these can be added from ‘scratch’
Advisers who are not yet registered for WI need to contact the Sales Support Centre (as they would do today for illustrations).
Illustrations that always need to be referred to the Sales Support Centre are:
DGT illustrations.
Non standard illustrations, for example, premiums below our stated minimum or where a life assured is aged more than 89 years attained.

19. (but DGT must be paper application)
Application routes
Applications can be made both by paper and WI
Which route depends on whether the adviser is set up or not on WI and if set up on WI the route depends on the investment choice and who is the applicant
Adviser not set up on WI
Adviser set up on WI
Applicant
Investment choice
SIS CIA – in full or part
Not SIS CIA WI
(but DGT must be paper application)
Corporate trustee – e.g. QROPS, QNUPS
Royal Skandia Trust Company
Individual or individual trustee
Paper application
Paper application

20. Online applications Online applications can be done one of two ways
Adviser completes application & client authorises
The adviser completes the application and the client views & authorises this through their WI Online Service Account (OSA)
The client registers for their OSA through an ed registration link, which would normally be sent to them by their adviser
The online approval from the client covers fees too
Adviser completes & authorises the application
The adviser acts as the client’s agent and both completes and authorises the application
Where fees are to be facilitated through the Portfolio Bond the adviser must upload and submit with the application a client signed Fee Authorisation form and a Specimen Signature form
Clients must register for their OSA to view their documentation
To submit an online application the adviser’s firm needs to have been set up on WI. Before this applications can only be by paper.

21. Paper applications
Paper applications exist for individual, trust and corporate applicants
New business and top-up applications are now separate forms
Applications forms will be available from the Sales Hub. Advisers can find them on our literature libraries and on the WI microsite
It is important that customers who apply by paper register for their WI Online Service Account to access the significant benefits WI offers.

22. Portfolio Bonds investing through SIS CIA
All SIS applications will remain paper based at launch and follow today’s approach
The adviser still sets up the SIS CIA investment first
Apply for a new Portfolio Bond using the new application
Complete the SIS CIA appointment form
Clients should NOT sign up for an Online Service account
Any bond level transactions, for example a withdrawal request, must be submitted on paper, as today. This will be reviewed in January and we will advise you if there is any change to this approach.
Any SIS transactions, for example dealing, can be done online via SIS, as happens today

23. Portfolio Bonds investing through SIS CIA
Advisers need to be aware of these key points for illustrations and applications
Illustrations
SIS CIA: The illustration must be on a nil adviser fee basis as all fees must come from the Portfolio Bond
Portfolio Bond: For the Portfolio Bond illustration the SIS CIA is selected as an investable asset. The RIY shown on the SIS CIA illustration must be input as the AMC for that investable asset. The adviser can then select a growth rate
SIS CIA online application form
A policy reference number is no longer available pre sale, instead the adviser needs to insert the clients surname and initials rather than the Portfolio Bond number
SIS CIA Appointment form
The adviser needs to insert the clients surname and initials rather than the Portfolio Bond number

24. Additional Information

25. Pipeline, legacy commission & closed products
Full details of our approach to Pipeline and Legacy Commission and details of closed products can be found on

26. RDR: Its application to Offshore business
The table below sets the scenarios in which we will apply adviser charging to offshore products sold in the UK
Adviser regulatory position
Adviser working from office In
Business Conducted/Carried Out
RDR (adviser charging) applies?
FSA regulated UK
In UK
YES
Outside of UK (e.g. Spain, IOM) NO
Outside UK (e.g. IOM) 
EEA firm with UK Branch
(FSA not prudential regulator) 
Outside UK (e.g. Spain, IOM)
EEA firm with Freedom of Service Passports in to the UK
Outside UK
NO*
Outside UK (e.g. Spain, France)
Regulated outside of the EEA or non-regulated
FSA rules do not generally apply to non FSA authorised firms. A firm would in breach of FSMA if undertaking regulated activity in the UK (which includes providing advice), unless working under an exemption under the Financial Promotions Order (FPO). If acting under FPO then adviser charging may well apply if acting under a legitimate approach basis.
* Note, however, UK regulated retail investment product providers are unable to pay commission in respect of a UK retail client regardless of the location and regulated status of the advisory firm.  The information provided is based on our interpretation of the relevant rules and is correct as at November 2012.
In summary adviser charging applies to all product sales made in the UK to UK based applicants

27. RDR & Professional investors
The RDR applies clients who fall within the FSA’s ‘retail client’ definition. Where a client is a ‘professional client’ under the FSA definition it is possible to pay commission on that business
At launch our default position is that all business submitted assumes the client to be a ‘retail client’
Your offshore specialist will be able to provide further information on this topic and answer any question you or your advisers have.

28. Wealth Interactive & Trusts
The table below summarises the position for WI and trusts
Trusts set up before the policy is started
Trusts set up after the policy is started
Application routes
If individuals as trustees = Online* or paper (if online all trustees must agree to online apply)
If corporate trusts (e.g. RSTC) = Paper application only
If individuals = Online or paper (if online all applicants must agree to online apply)
If a company = Paper application only
Key points
If paper application: Same process as today
If online application, supporting information can be uploaded and submitted with application
Lead policyholder should be appointed to transact online on behalf of all trustees where trust/law allows delegation)
If online application: Completed trust must be submitted by post and not uploaded online.
Available trusts
Enhanced Loan Trust
Loan Trust Unlimited/Limited Liability (Bare or Discretionary)
Discretionary Settlor Excluded
Discretionary Settlor Included
Absolute trust
Best start in life trust
Discounted Gift Trust (Bare or Discretionary)*
* Due to the medical questions that need to be answered at application stage, DGTs can only be paper applications .

29. Wealth Interactive & Trusts
The tables below set out who can view and submit deals for Portfolio Bonds in trust
Financial advisers can always view information for all of their clients; whether they can deal will depend on whether they have investment powers
QROPS/QNUPS
Royal Skandia Trust Company
QNUPS /QROPS Trustees
Adviser
Member who is also appointed by trustees as Investment Adviser
Member with trustees’ authority to view the policy only
All Policy Transactions
Yes No
View and submit deals
N/A
If fund adviser
View only
RSTC
RSTC appointed Fund Adviser
All Policy Transactions
Yes No
View and submit deals
N/A
View only for valuations

30. Available assets & asset review
On the 31st Dec WI advisers will be able to immediately access approximately 1,500 assets
Where an adviser finds that an asset which is needed for an illustration or online application is missing they can request an asset review through WI
As part of the asset review we will, if the asset is accepted, add all the information needed to set up that asset on WI
An adviser will be able to save the data entered up to the point the asset review was requested and return to it once the asset is added

31. The dealing charge objection
We have been specifically asked why the bonds still have a dealing charge of £15 when we are moving online with straight through processing (STP). The following will help you overcome this objection
The bonds offer an open architecture asset choice which is valued as a key part of our proposition (i.e. advisers are not restricted to a defined range of investments). A proportion of these assets do not accommodate STP and require manual intervention to place trades. Examples are money market assets and non UK registered funds
The asset manager has to accommodate STP – many do and we are working with those that do not to ensure future efficiency
STP dealing is not free – there are still costs (e.g. SWIFT automated messaging costs)
We will review our dealing charge regularly in light of above

32. Dealing charge – internal considerations
For your information, but not for external use:
We are retaining the dealing fee day 1 because we have no experience/evidence of the cost savings associated with the new systems
We are moving towards aggregated trading which will have the potential to drive down dealing costs in the future. This will take time because:
WI is a ‘start up’. On day 1 we start with no policies so no opportunity to aggregate
Migration will help deliver this mass but until then we cannot use trades on these policies to drive aggregation
As an offshore specialist we don’t have a variety of product wrappers that can drive scale through multiple product sales and the multiplier effect on trades this has
Open architecture dilutes the opportunity to aggregate through the sheer variety of assets available
We will be keeping dealing fees under review. However not all business has a dealing charge:
For monitored business we will continue to offer charging structures with an increased administration charge and no dealing charge – ‘£135/0’
If SIS CIA is held as an asset, no dealing charges will apply on trades (but the SIS CIA means clients incur a second layer of wrapper costs)

33. Marketing Materials

34. Marketing Material
The following range of material will be available on the Sales Hub by 28/12/12.
Adviser
Client
Promotional Video
Microsite –
interactive
Introducing Wealth Interactive (Adviser sales aid)
Unlocking the secrets of intelligent investing – client portfolio bond brochure
About our UK portfolio bond range for retail clients
At a glance (IPB-Life; IPB –Redemption; EPB-Life)
PowerPoint presentation - Wealth Interactive: transforming business
Key Features for RSAL and SLIL Portfolio Bonds
Key Features for Portfolio Bond investing through a SIS CIA (RSLAL and SLIL versions)
SIS CIA appointment form
Applications (individual investors – RSLAL and SLIL)*
Policy Terms** (all 3 products )
* Corporate applications to be added early January
** Where a client has an Online Service Account the Policy Terms will be issued to the account’s document library.

35. Coming Soon - New Features

36. More features/services are due very soon
Area
Service or Feature
Estimated delivery date
Adviser business
Automated bulk data downloads
January 19th
Adviser controlled password reset & unlock
February 9th
Investment process
Adviser created fund lists
Investment Tools Reports
19th January
Online Bulk dealing
Bulk re-balancing summary reports
Internal adviser firm application and dealing approval process
Client
Online top-ups
Client & Adviser
Online forgotten user name and password re-set
Additional alerts added
Details of these and further enhancements will follow in due course.

37. Future development
The plan is to launch a ‘simple’ product proposition during 2013 with the following features:
Restricted investment fund range
All funds will be STP’able
Reduced or nil dealing fee
Reduced or nil minimum dealing size
Online applications only
Limited price options
Recurring single premiums*
Phased investment option
Option to upgrade to the full offshore universe through the same product
Access to same WI adviser and client services
* Once recurring single premiums are available on the system, this option will be considered for the existing open architecture Portfolio Bonds