Portfolio bonds have been one of the most popular products for high net worth investors over the last number of years. Whether life companies wish to make this structure a core offering or simply to provide a niche product for their wealthier clients, IPSI can help define and manage a structure that will fit the need.
Few traditional life administration platforms can manage these products effectively. This is because there is a long-standing tradition of separating the life insurance “internal” funds from the underlying investment portfolio, although these structures have been in place for quite some time now. Most companies will use different systems to administer the two sets of data.
With portfolio bonds, each client has a unique life fund and owns 100% of the fund. The value of the fund is linked to a portfolio of investments that are owned by the life company and where management of this portfolio is delegated to the client or his appointed advisor.
While the structure is relatively simple, establishing a portfolio bond product does require a different perspective to the roles of fund management, investment mandate creation and to trading, settlement and reporting.
IPSI has extensive experience of implementing and administering these products and can provide a tailored service to meet the needs of life companies, distributors, custodians and most importantly the underlying investors.
