Unit Trusts and Equity Linked Endowment Assurances

Abstract

SynopsisThe aim of the paper is to discuss some of the problems relating to unit trusts and to the issue of annual premium endowment assurance policies with benefits linked to unit trusts or equities.SECTION I describes the background to unit trust operations including the main requirements for Board of Trade authorization.SECTION II analyses expenses of administration and patterns of expense loadings. It compares the traditional life assurance approach to expense loadings and normal unit trust practice.SECTION III describes the main broad types of assurance linked to unit trusts or equities now in force. It discusses the organizational and taxation considerations involved in issuing such contracts and the desirability of doing so.