Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
    • Moody's - Climate Risk Insurers series
    • Webinars
    • Podcasts
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive
Quick links:
  • Home
  • The Actuary Issues
  • April 2012
04

TLPIs 'should not be promoted to most UK investors'

Open-access content Wednesday 25th April 2012 — updated 5.13pm, Wednesday 29th April 2020

Traded life policy investments are high risk products that should not be promoted to the vast majority of retail investors in the UK, the Financial Services Authority has said.

2

The interim guidance confirmed by the regulator today comes as it prepares to consult on new rules which will impose significant restriction on the promotion of non-mainstream investments, such as TLPIs, to retail investors.

TLPIs invest in life insurance policies - typically of US citizens - with investors hoping to benefit by buying the right to the insurance payouts upon the death of the original policyholder. If these people live longer than anticipated, the investment may not function as expected.

According to the FSA, there is evidence of significant problems with the way in which TLPIs are designed, marketed and sold to UK retail investors, with many products failing and causing loss for investors.

Many TLPIs take the form of unregulated collective investment schemes, which - in most cases - cannot be legally promoted to retail investors, but have often been marketed to them.

Peter Smith, the FSA's head of investment policy said the regulator had been 'very concerned' about the potential of the TLPI retail market, which was already worth £1bn in the UK, growing more.

'At the time that we published our guidance over half of existing retail investments were in financial difficulty - even so, we were hearing about the development of new products intended to be sold to UK retail customers,' he said.

'The threat to new customers was significant and growing: the potential for substantial future detriment was clear.  There was a concern that we were witnessing a repeating cycle of unsuitable sales followed by significant customer detriment in the TLPI market. Following publication of the guidance for consultation, this threat has receded.'

He added: 'This is an interim measure - we believe that TLPIs and all unregulated collective investment schemes should not generally be marketed to retail investors in the UK and will be publishing proposals soon to prevent them being promoted except in rare circumstances.'

This article appeared in our April 2012 issue of The Actuary.
Click here to view this issue
Filed in
04
Topics
General Insurance

You might also like...

Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

New Fast-Growing Team - Actuarial Systems Development

London (Greater)
Excellent Salary Package
Reference
143762

Actuarial Pension Consultant – Scotland/Remote – Up to £90,000 plus bonus

Edinburgh / Glasgow / Remote working
Up to £90,000 + Bonus
Reference
143761

Part Qualified Pensions Actuary– Specialised Pensions Consultancy - Scotland/Remote - Up to £70,000

Edinburgh / Glasgow / Remote working
Up to £70,000 + Bonus
Reference
143760
See all jobs »
 
 

Today's top reads

 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2023 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited. All rights reserved. Reproduction of any part is not allowed without written permission.

Redactive Media Group Ltd, 71-75 Shelton Street, London WC2H 9JQ