Is Zurich Playing fair?

From 1/11/98 until 1/7/2000 I was paying monthly in to a pension with Zurich life.

I then started work with company with DC pension in place so Zurich Life pension was made paid up.

I have a number of unit linked funds with Zurich Life totaling about 250k gross.

I never payed much attention to the pension fund due to the fact that there is only about 2200 euro in the fund. I only noticed lately that I am been charged 4.4% AMC on this minute pension fund compared to 1% AMC on my funds.
Out of a fund of 2200 euro there have been about 600 euro in charges to date.

I do not care about this pension as such but I do feel this is very wrong. I contacted Zurich and after several e-mails and a letter back in January they informed me last week that they would be writing out to me next week. I informed Zurich that if they could not offer a better AMC in relation to this very small fund I would move my 250k elsewhere.

In the letter I received from Zurich they state

That they recover initial expenses by investing initial first two years premiums in Initial units which bear additional charge of 4%
Due to the fact that I paid into policy for less than two years funds will remain in initial units until I retire in 2023 and only then can I avail of .4% charge.
Zurich state that details are in policy document. This is true I did not read the small print nor did agent explain to me.
15 yrs after making policy payed up I do not feel this is fair.

Comments welcome. Am I wrong in cashing in my unit linked policies if there is no move on charges?

It's one of those old contracts that paid 50% - 60% initial commission to whoever set it up for you. As the letter stated, Zurich have to charge a massive AMC for the first few years and then down to a really competitive 0.4% thereafter. Being stuck at 4.4% for the remainder of the term isn't much good though. If you do move that contract out, they will recoup all the management fees that were due to them for the remainder of the term.

I wouldn't blame Zurich, it is the way things used to be. Thankfully, those contracts are a thing of the past.

You can get lower than 1% AMC on your other funds too.


Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)

DCD said:

Zurich state that details are in policy document. This is true I did not read the small print nor did agent explain to me.

Click to expand...

The thrust of your complaint is that the sales rep neglected to mention the less attractive qualities of his product? I wouldn't take it too personally.

By all means vote with your euro, but make sure somebody who works for you looks over the small print first.

trasneoir said:

The thrust of your complaint is that the sales rep neglected to mention the less attractive qualities of his product? I wouldn't take it too personally.

By all means vote with your euro, but make sure somebody who works for you looks over the small print first.

Click to expand...

Thanks for the replies folks. I await letter from Zurich life.
Regarding AMC charges on unit link funds. Enough moaning. I am cashing out today and am going to drip feed funds into cheap index funds over the next while. Thanks.