+44 7393 450837

advice@adamfayed.com

Follow on

If you are an expat interested in investing and long-term financial planning, Friends Provident International may be a name that you have heard of.

An Isle of Man-based financial services company, Friends Provident is established in the UK with a long history dating back over a hundred years.

The business specializes in financial planning for private investors and provides a wide range of services and products to expats all over the world, including those in Asia, Europe, and the Middle East.

This article will examine the business, the goods and services it provides, and whether you should buy them.

Please be aware that this post is meant solely for informational purposes. We advise seeking the services of a financial advisor or consultant you can trust if you want to invest with Friends Provident or if you want to know if their products are suitable for you and your objectives.

If you are looking to invest as an expat or high-net-worth individual, which is what I specialize in, you can email me (advice@adamfayed.com) or WhatsApp (+44-7393-450-837).

Overall we don’t recommend investing in Friends Provident International, but this article will also look at the positives as well as negatives.

Table of Contents

Who are Friends Provident International?

Friends Provident has a strong financial foundation and has been an established business for over 40 years. It is a component of International Financial Group Ltd (IFGL), which manages $23 billion in assets for 216,000 clients globally.

The company takes pride in being a multinational corporation that is aware of the areas in which it operates. The business has created solutions that are both tax- and money-efficient and have the adaptability to alter as circumstances demand.

Friends Provident has a B+ rating and a 5-star service rating from the actuarial consultant AKG, which specializes in providing ratings for the financial services sector. The rating is the highest of any offshore life operation.

The company asserts that its customers find great comfort in its location on the Isle of Man, a well-known worldwide financial hub with an outstanding reputation for investment safety and a slew of honors from around the world.

The Isle of Man was recently given the highest compliance rating for its worldwide sharing of tax information by the Organization for Economic Co-operation and Development, a level only attained by 38 countries globally, in addition to receiving “white list” designation.

Additionally, Moody’s assigned the Isle of Man an Aa3 sovereign rating, and for the third time in four years, The Isle of Man took home the coveted International Financial Centre Award at the 2021 International Advisor Product and Service Awards.

The island, which employs 9,000 people in the financial services sector, is also acknowledged by the International Monetary Fund as an outstanding offshore finance center of regulation.

Friends Provident International has been offering its insurance and investment products for over forty years
Friends Provident International has been offering its insurance and investment products for over forty years. | Photo: Pexels

Why is Friends Provident located in the Isle of Man?

The Isle of Man is where Friends Provident International is incorporated. The island, which is a part of the British Isles, is situated in the center of the Irish Sea, roughly halfway between England and Ireland.

The island has a great degree of legislative and political autonomy, serving as a protectorate of the British Crown and establishing its own laws and taxation regime that are separate from those of the UK.

It has a separate legal system that upholds English law and is neither a part of the United Kingdom nor a European Union member. King Charles III is in charge of the country.

Tynwald, the name of the parliament that governs the Isle of Man, has been in continuous use for more than a thousand years, making it the oldest parliament in the entire world.

The Island enjoys outstanding scores for financial stability. In October 2020, Moody’s assigned the island an Aa3 (Stable) rating.

The Isle of Man’s “credit profile is underpinned by high wealth levels established by a long history of strong economic growth, strong institutions, and cautious fiscal measures,” according to Moody’s.

A large buffer against shocks is provided by extremely high wealth levels, and the IoM has a long history of good GDP growth with low volatility.

The island, one of only a few little offshore financial centers to attain this classification, is an active member of the OECD and maintained its top “compliant” certification for worldwide tax transparency in 2017.

The Isle of Man met its commitments to enable full automatic transmission of tax information globally by becoming an early adopter of the global Common Reporting Standard.

For the fourth time in five years, the Isle of Man took home the coveted International Financial Center trophy at the 2021 International Investment Fund and Product Awards.

The Isle of Man Financial Services Authority (IOMFSA), an independent statutory body in charge of licensing and regulating Isle of Man-based banks, building societies, investment companies, collective investment schemes, and corporate and trust service providers, serves as the island’s primary regulatory body.

Also, it is in charge of regulating the insurance and pension industries on the island. The IOMFSA seeks to ensure that policyholders are adequately protected, to uphold worldwide trust in the island’s insurance and pension sector, and to thwart financial fraud.

The IOMFSA unveiled a new Conduct of Business Code in 2019 with the aim of enhancing the Island’s current regulatory framework, enhancing customer protection, and increasing transparency.

The IOMFSA, which enjoys an extensive reputation, works closely with international colleagues to guarantee that anyone choosing the Isle of Man for their financial goods will receive the best possible support.

Investment Strategies and Portfolio Management at Friends Provident International

Overview of Investment Strategies

Friends Provident International (FPI) offers a diverse range of investment strategies to meet the varying needs of its clients. In 2023, FPI continues to adapt its strategies to align with global market trends and individual investor goals.

Their investment approach is characterized by a blend of active and passive management styles, ensuring a balanced and risk-adjusted return for investors.

Active and Passive Management Styles

FPI employs both active and passive investment management strategies. Active management involves selecting stocks or other assets in an attempt to outperform the market or a specific benchmark.

Passive management, on the other hand, focuses on replicating the performance of a market index or benchmark. By combining these two approaches, Friends Provident International caters to a wide range of investment preferences and risk tolerances.

Portfolio Management Techniques

The portfolio management at Friends Provident International is designed to optimize asset allocation and diversify investment risks. In 2023, FPI has continued to refine its portfolio management techniques, incorporating advanced analytical tools and market research to guide investment decisions.

Asset Allocation and Diversification

Asset allocation is a key strategy used by Friends Provident International to balance risk and return in its investment portfolios.

By diversifying investments across various asset classes, geographical regions, and sectors, FPI aims to reduce the overall risk while capturing potential growth opportunities.

This approach is particularly beneficial for long-term investors, including those planning for retirement or seeking stable income streams.

Adapting to Market Changes

Friends Provident International actively monitors global economic trends and adjusts its investment strategies accordingly. In 2023, FPI has shown agility in responding to market changes, ensuring that its investment portfolios remain robust and well-positioned for growth.

Responsiveness to Global Economic Trends

In response to the dynamic global economic environment, Friends Provident International continually assesses and adjusts its investment strategies.

This includes staying abreast of international market trends, economic indicators, and geopolitical events that could impact investment performance. FPI’s proactive approach in adapting to these changes reflects its commitment to delivering sustainable returns to its investors.

Sustainable and Ethical Investing

Sustainable and ethical investing has become a significant focus for Friends Provident International. In 2023, FPI has enhanced its investment offerings to include options that prioritize environmental, social, and governance (ESG) factors.

ESG Integration in Investment Decisions

FPI integrates ESG considerations into its investment analysis and decision-making processes. This approach not only aligns with the growing demand for responsible investing but also contributes to the long-term sustainability of investments.

By considering the ESG impacts, Friends Provident International is able to identify investments that are not only financially sound but also socially responsible.

How does Friends Provident protect its clients’ funds?

Friends Provident offers expats and local citizens in Europe, Southeast Asia, and the Middle East savings, investment, and protection products. The employees at FPI, which work in offices in Dubai, Hong Kong, Singapore, and the Isle of Man, are all trained to assist the company’s clients in achieving their financial objectives.

FPI has more than 40 years of experience in the global market for life insurance.

When the Isle of Man welcomed its first offshore life assurance companies in 1978, the company was among the first financial institutions to locate there.

One of these companies was Lloyd’s Life (Isle of Man), which eventually changed its name to Royal Life International, Royal and Sun Alliance International Financial Services, and finally Friends Provident International in 2002.

FPI was purchased by IFGL in July 2020 from Aviva. With 216,000 customers, USD23 billion in assets under management, and 570 employees as of December 31, 2022, IFGL offers investing, savings, and protection products to foreign investors all over the world.

As an international insurance provider, ensuring its clients’ investments and savings are safe and secure is crucial to Friends Provident’s business.

As such, clients benefit from two layers of security that the company’s location in the Isle of Man offers.

The Isle of Man Insurance Regulations of 2018 require life insurers to maintain adequate capital to provide policyholders confidence that future liabilities can be satisfied as and when they become due.

The solvency capital requirements are estimated to ensure that businesses stay viable following a one in 200 year risk event, taking into account all of the quantifiable risks that an insurer confronts.

In order to prove their solvency, businesses are required by law to produce independently audited annual reports to the government and the general public. This requirement contributes to the continued public confidence in the financial standing of Isle of Man life insurers.

Additionally, a new Insurance Act with stringent rules for on-island insurance providers was passed by the Isle of Man in 2008.

All insurance providers are obligated to ring-fence 100% of policyholder assets, ensuring that they can never be used for anything other than paying policyholders’ claims and liabilities.

Hence, no matter what the future may bring, Friends Provident is obliged to hold its policyholders first, and liquidators will never be permitted to access client assets.

Additionally, in order to prove the company’s financial soundness to authorities, Friends Provident International are obligated to provide regular solvency calculations.

A Policyholders’ Compensation Fund is used by the Isle of Man to manage a policyholder protection program.

According to the provisions of the program, the policyholder will receive compensation equal to up to 90% of the insurer’s responsibility with respect to their policy if a life insurance firm is unable to pay its obligations.

No matter where policyholders live, they are protected by the system, which operates on a worldwide scale. A tax on all life insurance providers doing business on the Isle of Man provides funding for the compensation program.

The island also offers a free, impartial dispute resolution service called the Financial Services Ombudsman System for clients who have been unable to settle a grievance with their financial services provider directly.

All Isle of Man service providers governed by the Isle of Man Financial Services Authority (IOMFSA) must comply with the Insurance (Conduct of Business) Code as of 2019.

This comprehensive and progressive law is the pinnacle of international financial services regulation and establishes the benchmark for other governments to follow.

The code encourages more openness regarding the fees and charges levied against policyholders, mandated a 30-day cancellation period, and increased providers’ accountability for ensuring that financial advisers disseminating their products have the necessary regulatory authorization, expertise, and experience to properly advise clients.

The Conduct of Business code highlights the Island’s dedication to offering policyholders the best possible protection and is intended to improve client experiences.

Because of its Isle of Man location, Friends Provident operates under laws and a taxation regime that are separate from those of the UK
Because of its Isle of Man location, Friends Provident operates under laws and a taxation regime that are separate from those of the UK. | Photo: Pexels

Understanding the Regulatory Framework Governing Friends Provident International

Friends Provident International: A Robust Financial Entity

Friends Provident International, a subsidiary of International Financial Group Ltd (IFGL), manages $23 billion in assets for 216,000 clients worldwide.

With over 40 years of establishment, it boasts a strong financial foundation. The company has tailored tax- and money-efficient solutions, adaptable to changing circumstances, highlighting its multinational awareness and operational adaptability​​.

Ratings and Global Recognition

The company is highly rated, with a B+ rating and a 5-star service rating from AKG, a specialized financial services sector consultant.

This is the highest rating for any offshore life operation. Furthermore, its Isle of Man location is a significant comfort to its customers, offering investment safety and international acclaim​​.

Isle of Man: A Financial Hub

Friends Provident International is incorporated in the Isle of Man, known for its high compliance rating in global tax information sharing by the OECD.

The Isle of Man also boasts an Aa3 sovereign rating from Moody’s. Recognized by the International Monetary Fund as a premier offshore finance center, it excels in regulation and has received numerous awards for being an International Financial Centre​​.

Legislative and Political Autonomy

The Isle of Man, where Friends Provident International is incorporated, is not part of the UK or the EU. It has its own laws and taxation regime, maintaining a high degree of legislative and political autonomy. This unique position provides a stable environment for Friends Provident International’s operations​​.

Financial Stability and Regulation

The Isle of Man’s financial stability is underscored by Moody’s Aa3 (Stable) rating, high wealth levels, and a history of strong economic growth.

As an active OECD member, it maintains top compliance for global tax transparency and has adopted the Common Reporting Standard for tax information sharing.

The Isle of Man Financial Services Authority (IOMFSA) is the primary regulatory body, overseeing banking, investment, and other financial services on the island​​.

What products does Friends Provident International offer?

As part of IFGL, Friends Provident International provides investment, savings and protection solutions to international investors around the world.

The following advantages are offered by Friends Provident International’s access to funds: funds in a variety of currencies; a wide selection of funds that span all significant asset classes; and a suitable investment strategy for every investor type.

As an international provider, Friends Provident also allows its clients the ability to manage their portfolio online whenever it’s convenient by rerouting future premiums and changing current investments through an online portal, alongside giving regular updates on fund performance and pricing per month.

Friends Provident International Premier Advance Savings Plan

Friends Provident International offers a popular unit-linked regular payment savings plan called Premier Advance, intended to be retained as a medium- to long-term investment.

If you are at least 18 years old but under 70 at the start date, you are eligible. The lives assured may be of any age, but at the end of the initial payment term, at least one of them must be younger than 76.

The Premier Advance savings plan from FPI will have a minimum regular payment that may vary depending on the frequency selected.

The plan’s objectives are as follows:

While under the plan, you as the policy holder are committing to make regular payments throughout the payment term, and view your plan as a medium to long term investment.

Friends Provident makes no guarantees regarding the future value of your plan. This will rely on a variety of variables, including as the investment performance of the funds you invest in, the company’s fees and any changes to these fees, the amount of money you withdraw, and any upcoming changes to tax laws.

Be aware that the plan’s value can fluctuate. You may get back less than you have paid in. You have access to investment funds that invest in a variety of securities, including stocks and shares, and incur varying degrees of risk. Some funds’ values will fluctuate more than others.

The value of a fund you invest in may fluctuate if the fund’s currency is not the same as the plan currency due to changes in the exchange rate. The purchasing value of whatever money you get in the future will be diminished by inflation.

Also, if you stop making payments in the early years, you can earn back less money than you put in due of costs and market downturns.

What are the features of Friends Provident International Premier Advance?

As a unit-linked regular payment savings plan, Premier Advance includes an aspect of life cover. After ten years, if you keep up your payments, it offers a continuing loyalty incentive.

You can create the plan for up to four lifetimes—yours, someone else’s, or jointly for up to four lives. You also get to decide how long you want to pay for; the terms range from 5 years to 25 years.

Under the plan, you decide the currency in which your plan is denominated as well as the currency in which you make payments. This can be paid for in US dollars (USD), British pound sterling (GBP), euros, or HK dollars (HKD)

Unless otherwise specified on your application, all statements, correspondence, and payments will be made in the currency you have selected. If necessary, the currency can be changed at a later time.

You have the option of making payments every month, quarter, half-year, or annually. Any payment due date that corresponds to the new frequency can be used to adjust your payments’ frequency.

You can increase your payment on any payment due date assuming there are at least five years of the payment period remaining.

If there are at least five years of the payment period left, you can add further lump sum payments to your plan at any time.

You can always cash out your plan, albeit there might be a fee.

To give yourself more flexibility, you are allowed to first set up your plan as ten similar policies. For example, you might cash-in some policies and keep the others operating. After your plan has begun, you cannot adjust the amount of policies.

You may also make one-time or recurring withdrawals and you have the option to change funds.

Where are my payments invested?

Your payments will be put toward the fund or funds of your choice.

Friends Provident International has a large selection of funds that have been hand-picked by its in-house investing specialists.

On the company website in the Fund Centre section, you can find comprehensive information about the funds, together with the most recent performance information, pricing, and risk ratings, as well as a number of tools to help you focus your study and analysis.

Before making any investment selections, it is advised that you talk with your financial advisor about your choice.

Up to ten funds may be purchased at once. The money is available in GBP, USD, or EUR.

Each fund is divided into units by Friends Provident, and your payments are used to purchase units in the funds you select. The value of the investments made in the fund determines how much a unit costs.

There are two types of units within your funds: starting units and accumulating units. Initial units receive your payments for the first 18 months (and the first 18 months of any payment increase).

The allocation of funds to accumulation units occurs after this 18-month period. Accumulation units also receive any additional lump sum payments. Both sorts of units are priced the same per unit. Changing funds is always an option.

The Role of Technology in Enhancing Customer Experience at Friends Provident International

Embracing the Digital Revolution

Friends Provident International (FPI), a veteran in the international life assurance market for over 40 years, has been actively aligning its business strategy with evolving customer needs, focusing on providing savings, investment, and protection solutions, especially in Asia and the UAE​​.

At the heart of FPI’s approach is the adoption of a ‘Digital First’ strategy, an initiative shared with its parent company, Aviva. This strategy aims to integrate digital solutions into every aspect of their services, as it’s increasingly expected by customers and advisers alike​​.

Innovations in Customer Interaction and Advising

FPI has launched significant digital features to enhance customer interaction and advisory services. A key development is the introduction of online fund switching and premium redirection through the FPI Portal.

This function simplifies investment portfolio management, enabling customers and advisers to access and modify investments and premium allocations digitally, thereby removing cumbersome paperwork​​.

Steve Weston, Chief Operating Officer and Managing Director IOM at FPI, emphasizes the company’s commitment to developing online tools that offer more control and convenience to policyholders​​.

Digital Tools and Applications

To further facilitate the ease of doing business, Aviva, in Asia, has developed tools like the EzSnap app for document management and is re-developing the Sales Quotation System for FPI advisers, moving more functionalities online.

These tools are part of a broader initiative to simplify basic processes and provide more online functionality, reflecting FPI’s drive towards digital transformation​​.

Global Digital Initiatives and Collaborations

FPI’s digital journey is not isolated; it’s part of a larger, global initiative under Aviva. For instance, Aviva-COFCO, a joint venture in China, launched a health and wellness platform providing digital services like the Chunyu Online Doctor, a 24-hour online medical consultation service.

These initiatives demonstrate a commitment to offering digital solutions that meet the evolving needs of customers globally​​.

The Digital Garage: A Hub for Innovation

A pinnacle of this digital transformation is the establishment of the ‘Digital Garage’ in Singapore by Aviva Group.

This innovation center, described by Mark Wilson, Group CEO of Aviva plc, as more than just a building, is a campus where ideas are brought to life.

The Digital Garage is designed to foster collaboration, innovative thinking, and project-based work, different from traditional insurance office environments.

Here, technical specialists, creative designers, and commercial teams explore, develop, and test new insurance ideas and services. This initiative reflects a commitment to staying at the forefront of digital innovation and adopting global best practices in digital solutions​​.

What are the charges and fees?

Over the course of your plan, an initial charge of 1.5% is deducted from the starting unit holding each quarter. On the quarterly anniversary of the plan’s start date, the initial units are canceled to collect this fee.

There is a USD 6 (GBP 4, EUR 6, HKD 48) monthly plan fee. Based on the start date of the plan, this charge is collected through the cancellation of accumulation units at regular monthly intervals.

The plan payment will accrue without interest during times when there are no accumulation units available. Accumulated fees are promptly subtracted once accumulation units are available.

Both fees are incurred at the beginning of your plan and last through the payment period. The monthly plan charge will continue if you choose to keep your plan invested after your payment period has ended.

An annual fee of 1.2% of the plan value is also assessed for the administration of funds. The amount of the underlying fund manager’s annual management fees and other fund expenses varies depending on the fund selected. These fees are debited directly from the fund on each trade day and are reflected in the unit price of the funds you select.

Take note that there are also other fees that can be incurred. If you pay using a credit card for instance, Friends Provident International will deduct 1% to 1.95% from each payment to compensate the fees assessed by the credit card company. Your country of residency will determine the precise cost.

If you pay in one single sum, there will be a 7% startup charge.

‘Enhanced initial units” are initial units applied to your strategy above 100%.

A portion of the enhanced units will be recovered if you reduce your original payment and continue to make this reduced payment for more than 12 (consecutive or non-consecutive) months or cash-in individual policies during the first five years, and may be subject to a charge if you reduce or stop making your payments.

All of the enhanced units will be recovered if any of the following occurs: you cash in your plan during the first five years and have not paid your original payment in full for at least 48 months; or your payments are not made for more than 12 months (consecutive or non-consecutive) due to a payment holiday or making the plan paid-up.

Presently, switching between funds is free, but Friends Provident retains the right to charge up to 1% of the amount involved or USD 15 (GBP 10, EUR 15, HKD 120), whichever is greater, upon giving you one month’s written notice.

If you choose to cash in the entirety of your plan early, the initial units will be subject to the cash-in charge listed in the table below.

Keep in mind that unless you have made at least 12 months’ worth of payments, your plan will not have a cash-in value.

What other considerations should I know about Premier Advance?

Depending on your needs, you can withdraw money from your plan on an occasional or ongoing basis.

Regular withdrawals may be made every month, every quarter, every term (every four months), every half-year, or every year. Withdrawals are free but can only be made from units of accumulation.

If there are insufficient accumulation units or if the proposed withdrawal causes the plan to lose more value than the minimum plan value, the withdrawal will not be made.

You can suspend payments after the first 18 months if you so wish. For up to 12 months, you may put payments on hold.

They can always be restarted. You can also pay off your plan in full and stop making payments.

In either case, the value of your plan will continue to fluctuate in line with the performance of the funds you invest in as investors. Costs will still be deducted from your plan, which could reduce the value of the plan as a whole.

If you opt to cash in the plan, you will receive the plan’s value. This value will vary depending on a number of factors, such as: the length of time you invest for; the performance of the assets; the fees; any withdrawals you make; and any loyalty benefits you earn.

Unfortunately, there is no assurance regarding the cash-in value because it is subject to a variety of factors that may cause it to fluctuate.

Upon your plan’s tenth anniversary, loyalty bonus units worth 0.5% annually will be added. During the course of the year, this 0.5% bonus will be paid in monthly installments. As long as you make your payments, the bonus will keep coming.

The duration of your plan is intended to be the duration of the payment period. If you cash in your plan before the term is over, there will be a cash-in fee.

If you base the plan on your life, it will expire if you pass away. At the time of your death, Friends Provident will pay an additional 1% on top of the cash-in value of your plan.

The plan can be configured to continue after the first death with up to four lives. On the death of the final survivor alone, the cover will pay an additional 1% on top of the plan’s cash-in value, and the plan will then come to an end.

The death benefit is dependent on the plan value, so there is no guaranteed amount.

6bbe906a a112 4935 8a04 b58c62d08f7d 1
The portfolio management at Friends Provident International is designed to optimize asset allocation and diversify investment risks.

How about taxes?

Your application for any benefits under the plan may be impacted by any currency or tax restrictions or legislation that you may be subject to under certain conditions.

For your particular situation, it is advised to speak with a lawyer, tax professional, or financial advisor.

This product’s tax-related information is based on what is understood to be the law at the time. Please be aware that tax laws can change.

As a tax-exempt insurance provider in the Isle of Man, Friends Provident International is not subject to income taxes, capital gains taxes, or corporate taxes in the Isle of Man nor the United Kingdom.

As such, except for any withholding taxes on investment income that are deducted at source in the nation of origin, their funds can accumulate tax-free.

Tax laws are subject to change, and your tax liability will vary depending on where you live and other factors. For expert advice, it is recommended to speak with a financial or tax advisor.

The Isle of Man government has signed several agreements governing the exchange of information.

According to these agreements, Friends Provident must give the Isle of Man Treasury Department specific information about policyholders so that they can disclose it to the other participating governments with which they have agreements.

Friends Provident is also required by law to report certain events where benefits are received from the plan by a UK resident individual or trust to UK HM Revenue & Customs. This information is important for possible plan holders who want to settle in the UK.

Many of Friends Provident's products are available for expats in the Middle East
Many of Friends Provident’s products are available for expats in the Middle East. | Photo: Pexels

Friends Provident International – International Protector (IPME)

Friends Provident International, as a multinational insurer, has a large market presence in the field of providing international term insurance.

International Protector Middle East is a customized protection system that provides comfort in the worst-case scenario.

There are three types of coverage are available: stand-alone critical illness cover, stand-alone life cover, and life cover or earlier critical illness cover.

What are the benefits?

Depending on your situation, you can choose between level or decreasing term assurance. The following benefits are offered by the plan:

Please take note that Friends Provident must receive your original, fully filled application form within six weeks of your signature.

Depending on which number is lower across all applications to which this insurance applies, the cover amount is either USD250,000, GBP140,000, or EUR200,000, or the life cover sum assured requested.

You, your spouse or partner, and any children residing with you also have access to Best Doctors service thanks to your coverage.

This gives you the chance to get a second opinion from a network of medical professionals who will examine your situation and offer guidance and treatment suggestions.

When Critical Illness Cover or Life coverage is selected, there is also Free Children’s Critical Illness and Disability Benefit included.

In the event that the Life Assured’s child is diagnosed with a critical illness or disability after their first birthday and before the age of 18, the policy will pay out a lump sum of up to USD15,000 or 10% of the sum assured of the Critical Illness Cover (whichever is lower) per child per parent/legal guardian.

This plan allows for a maximum of three claims for children’s critical illness and disability benefits (a maximum of one claim per child across all qualifying policies).

The Critical Illness Cover, Life, or Early Critical Illness Cover sum insured is not diminished by the payment of a claim under this benefit. The plan will continue, as will all other coverage.

What are the terms of International Protector?

If your policy period is three years or more, Life Cover will pay out if you pass away within that time or, if you are diagnosed with a terminal disease at least 18 months before it expires.

You can add Total and Permanent Disability Benefit to your Life Insurance for an extra fee. This benefit will keep you from working until the end of your cover term or until you turn 65, whichever comes first.

Level or decreasing levels of life insurance are offered.

The plan and its coverage will stop once Friends Provident pays the cover amount.

If you are initially diagnosed with a critical illness or handicap that matches the policy description during the cover period and go on to survive for at least 28 days, the Critical Illness Cover will pay out. This must happen at least 90 days following the day the start of your coverage.

CIC, or critical illness cover, is only offered on a level cover basis. The plan and all forms of coverage will expire if the policy pays the cover amount.

If you die during the cover term, are given a terminal diagnosis at least 18 months before the end of the cover term, or are initially diagnosed with a critical illness or disability that meets the policy definition before your 70th birthday, at least 90 days from the start of your cover, and then survive for at least 28 days, you will receive payment from the Life or Earlier Critical Illness Cover.

This can also be purchased with level or decreasing cover.

The plan and all forms of coverage will expire if the policy pays the cover amount.

Under Level Cover, over the selected cover term, your cover amount would not change.

Under Decreasing Cover, throughout the course of your selected cover term, your cover amount would decrease to zero in line with the capital due on a payback loan based on your selected interest rate. You can choose between two interest rates while reducing cover: 7% or 11%.

To purchase the plan, you must be at least 18 years old. In combined life situations, the coverage is limited to the oldest life assured’s maximum age.

Free Critical Illness and Disability for Children Only children between the ages of one and 18 are eligible for benefits.

Before the life assured reaches age 65, coverage for the following critical illnesses will expire: Alzheimer’s disease or dementia; Chronic Organic Brain Disease; Impairment of daily activities due to permanent disability; and Parkinson’s disease.

Friends Provident offers free critical illness and disability coverage for your children included in their plans.
Friends Provident offers free critical illness and disability coverage for your children included in their plans. | Photo: Pexels

Analyzing the Financial Performance and Stability of Friends Provident International

Current Financial Landscape

Friends Provident International (FPI), a subsidiary of International Financial Group Ltd (IFGL), has maintained a robust financial foundation over its 40-year history.

As of 2023, IFGL oversees an impressive $23 billion in assets for a global client base of 216,000 individuals. This achievement highlights FPI’s capacity for managing substantial financial resources and catering to a diverse international clientele​​.

Investment Portfolio Expansion

In 2023, FPI showcased a dynamic expansion in its investment-linked funds. These ranged from opportunities in emerging markets and sustainable global thematic funds to sector-specific investments in areas like healthcare innovation and global infrastructure.

This diverse portfolio includes investment options across various regions, including Asia, Europe, and Latin America, demonstrating FPI’s commitment to offering a wide array of investment choices to its clients​​.

Strategic Growth and Partnerships

A significant development for FPI in 2023 was the acquisition of its parent company, IFGL, by Cinven, an international private equity firm. This change in majority investment from Vitruvian Partners to Cinven received regulatory approval, signaling a new phase of growth and expansion for FPI.

With Cinven’s strong track record in fostering growth and its expertise in the financial services sector, FPI is poised for further development. This partnership is expected to fuel FPI’s ambitions for organic growth, market expansion, and potential mergers and acquisitions​​.

Service Quality and Market Recognition

FPI’s service quality and market standing are reinforced by its B+ rating and a 5-star service rating from AKG, a specialist in financial services ratings.

This accolade, the highest for any offshore life operation, attests to FPI’s reputable standing in the financial services sector. Such recognition is indicative of FPI’s consistent performance and reliability in providing financial services​​.

Responsible investing funds

The Stewardship fund, one of the first fully ethical investment vehicles, was originally made available in the UK by Friends Provident International.

The company is aware of the growing interest among investors in more socially conscious funds. Many firms are now incorporating ESG criteria into their operations to enhance how they run as a result of this and regulatory pressure.

Research suggests that businesses that use ESG criteria are not only gaining popularity but also displaying resilience, which puts them in a better position for long-term sustainable growth.

And as a result, investors are no longer required to give up performance in order to invest in funds that are acting morally.

Friends Provident International offers an interactive fund center that includes Morningstar’s Sustainability Ratings in the form of 1–5 globes to assist advisors and investors in assessing how investment funds are addressing environmental, social, and governance concerns (5 being high conviction, 1 being low).

The company’s unit-linked fund range currently offers a variety of thematic equity funds whose portfolios invest in companies functioning sustainably, ethically, or utilizing ESG criteria to operate their operations, which are often referred to as “thematic” funds for investors wanting to invest in them.

Take note that Hong Kong investors cannot access these funds.

Future outlook and expansion plans of Friends Provident International

Regulatory Framework and Client Protection

Stringent Regulations for Enhanced Security

FPI, under the jurisdiction of the Isle of Man, adheres to the Isle of Man Insurance Regulations of 2018. These regulations mandate life insurers to maintain adequate capital to cover future liabilities, ensuring the company’s viability even in the face of a one in 200-year risk event.

This requirement encompasses all quantifiable risks an insurer faces, thereby bolstering client confidence in FPI’s financial stability​​.

Independent Auditing for Transparency

FPI is legally required to produce independently audited annual reports. This practice is not only a legal mandate but also a critical factor in maintaining public trust in the financial integrity of Isle of Man life insurers​​.

Policyholder Asset Protection

Under the 2008 Insurance Act, FPI must ring-fence 100% of policyholder assets. This means that these assets are protected and cannot be used for any purposes other than settling policyholder claims and liabilities​​.

Global Policyholder Protection Program

FPI is part of a policyholder protection program managed by the Isle of Man. In the event of an insurer’s inability to fulfill its obligations, policyholders are entitled to compensation of up to 90% of the insurer’s liability.

This program is funded by a tax on all life insurers operating in the Isle of Man and extends protection to policyholders worldwide​​.

Commitment to Financial Services Regulation

Adherence to the Conduct of Business Code

Since 2019, all service providers in the Isle of Man, including FPI, must comply with the Insurance (Conduct of Business) Code.

This law mandates greater transparency regarding fees and charges, a 30-day cancellation period, and increased accountability for financial advisors promoting products.

This code underlines the Isle of Man’s commitment to providing the highest protection to policyholders and enhancing client experiences​​.

Strategic Expansion and Service Offerings

Expanding Global Presence

FPI, as part of the International Financial Group Limited (IFGL), has expanded its operations with the establishment of a new company in the Dubai International Financial Centre (DIFC), receiving regulatory approval from the Dubai Financial Services Authority (DFSA).

This move signifies a strategic expansion into new markets, broadening FPI’s global footprint​​.

Recognition and Sponsorships

In 2023, IFGL, the parent company of FPI, was awarded the Best International Life Group at the International Investment Awards, further cementing its position as a leading player in the international financial sector.

Additionally, IFGL has initiated a three-year sponsorship deal as FC Isle of Man’s Community Partner, showcasing its commitment to community engagement​​​​.

Investment, Savings, and Protection Solutions

FPI offers a range of financial solutions, including investment, savings, and protection services. Clients benefit from access to funds in various currencies, a broad selection of funds across major asset classes, and tailored investment strategies.

FPI also facilitates online portfolio management, allowing clients to conveniently modify investments and track fund performance​​.

5e49a385 f724 42e9 83aa 2014a0fc9b07
Your application for any benefits under the plan may be impacted by any currency or tax restrictions or legislation that you may be subject to under certain conditions.

Should I invest in Friends Provident International?

Reviews for Friends Provident International are negative at TrustPilot, which gives the company an overall score of 2 out of 5 stars based on 222 reviews as of March 2023.

Many of the reviews say they have had bad experiences with the customer service department, if they could reach out to customer service at all. There are also some that mention huge losses in their investments due to fees.

Meanwhile, Friends Provident International’s IPME+ won the Best International Protection Plan at the Global Financial Services Awards and the Best Protection Plan at the 2022 International Investment Awards.

Friends Provident is a prominent financial services company with over forty years of experience. Long-term individual investors searching for protection against market volatility or inflation but with modest investment objectives might choose from a variety of products that could deliver respectable returns.

If their insurance and expat savings plans meet your specific needs, Friends Provident International’s unit-linked insurance products could offer long-term individual investors respectable returns.

If you decide to invest in them, make sure to talk to your financial advisor about the best course of action and for their suggestions.

For individuals looking for bigger returns on their investments than what the current products offer, there are, nevertheless, better possibilities available.

Pained by financial indecision? Want to invest with Adam?

smile beige jacket 4 1024x604 1

Adam is an internationally recognised author on financial matters, with over 735.2 million answer views on Quora.com, a widely sold book on Amazon, and a contributor on Forbes.

Leave a Reply

Your email address will not be published. Required fields are marked *

SUBSCRIBE TO ADAM FAYED JOIN COUNTLESS HIGH NET WORTH SUBSCRIBERS

SUBSCRIBE TO ADAM FAYED JOIN COUNTLESS HIGH NET WORTH SUBSCRIBERS

Gain free access to Adam’s two expat books.

Gain free access to Adam’s two expat books.

Get more strategies every week on how to be more productive with your finances.