How is the Government helping me save?

The Government has recognised the importance of saving – as well as providing financial security it helps reduce inflation. To encourage personal savings the Government is supporting a new regular savings scheme called a Special Savings Incentive Account. The Government will add €1 for every €4 you save for the five year duration of your savings plan. So long as you do not access your savings for five years, the only tax you will have to pay will be on the investment growth on your savings.

There are some conditions, but its not everyday that the taxman puts money back into your pocket. It’s an opportunity not to be missed!

What is Hibernian doing to assist saving?

When the Government launched their savings initiative, the challenge was thrown down to produce a simple, cost effective and flexible savings plan. Hibernian’s response to this challenge is the Hibernian Spectrum Special Saver.

• You can save any amount from €10 to €200 per month and after year 1 you can vary this any time should your circumstances change.
• If you need, you can stop paying into the plan after one year.
• There is no bid offer spread or any other entry charges on this contract. The only charges are an annual management charge of 2% of the fund and a €1.50 (€1.18) monthly policy fee.

• Hibernian will automatically add the Government contribution to your plan each time you save. We will look after the paperwork of getting the Government’s contribution.

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How will my savings be invested?

Hibernian offer you the choice of 22 funds through which you can invest your savings. These funds vary according to potential growth and volatility. The higher the potential growth the greater the risk and vice versa. For instance the Hibernian Cash fund offers no risk to capital but there is modest potential growth. On the opposite end of the investment spectrum, the Hibernian Latin American Fund offers high potential growth but there is a greater risk to your capital. The table below shows all our funds arranged according to potential growth and capital security.

Three of the more popular investment options for the savings plan are outlined below:-

Option 1:
Target 20 fund

The Hibernian Target 20 Fund is a focused investment fund. It invests in a select group of 20 stocks chosen in specific sectors. These sectors are identified as those which have the greatest potential for strong and profitable revenue growth.

Option 2:
Balanced Managed fund

This fund consists of stocks and shares of companies around the world, government bonds, property and cash. While investments in this fund are not guaranteed, over time this kind of fund has outperformed bank deposit returns.

Option 3:
Cash fund

The return on the cash fund depends on prevailing bank interest rates. Because of this, the return on this fund is not forecast to be substantial – however investments in the cash option are guaranteed not to fall in value.

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What kind of return could I get on maturity of a Spectrum Special Saver?

It is difficult to predict exactly how each individual plan will perform. The table below gives an indication of how a plan for €100 per month will perform assuming investment growth rates of 4%, 6% and 8%.

Keeping you Informed

Your questions answered

Who can to open a special savings plan?
Everyone over 18 is eligible to hold a savings plan.

Is there a maximum monthly premium?
You can save a maximum of €200 per month.

Is there a term on this policy?
The Spectrum Special Saver plan has a five year term.

Is there a limit on the number of savings plans I can hold?
You may only hold one Special Savings Plan at any time.

How can I pay into the Hibernian Saver Plan?
Payments into the Spectrum Special Saver can only be made by direct debit. A direct debit mandate is attached to the application form.

What is the taxation treatment of the savings plan?
So long as you do not encash your savings within 5 years of commencing your policy, only the growth on your savings plan is taxable. This will be taxed at 23%.

What happens if I encash my plan before 5 years has expired?
If you encash your savings within the 5 year period, then the total amount encashed is taxable at 23%. This is so the Government can claw back the additional bonus paid.

We will charge a €30 (€23.40) administration fee for such an early encashment.

Is there a death benefit with this policy?
If you die during the policy, Hibernian will pay out the greater of the value of your policy. or

1. If you are less than 65 years of age at outset: An amount equal to the total contributions (including the government’s) over the full 5 years.
2. If you are over 65 years of age at outset: An amount equal to the total contributions (including the government’s) over 1 year.

Can I switch between investment funds during the term of the plan?
You can switch the investment of your plan at any time. The first switch in any year is free of charge. Subsequent switches have an administration charge of €20 (€15.75)

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Key features

Information about the policy

1. Make sure the policy meets your needs
   The Spectrum Special Saver is a 5 year unit linked contract specifically for customers availing of the Government’s Special Savings Incentive Account Scheme.
   
   It is a regular premium contract. The minimum premium is €10 per month and the maximum is €200 per month. Premiums may only be paid by direct debit mandate.
   
   The government will contribute, for a five year period, an amount equal to 25% of the individual’s premiums.



2. What happens if you want to cash in the policy early or stop paying premiums?
   You can make the policy paid up after the first years premiums have been paid. This means that no future premiums are expected and the fund continues to grow until policy matures in the fifth year. You only receive government contributions in respect of the premiums you paid.
   
   If you wish to encash your policy you may do so after one years premiums have been paid. You will have to pay an exit tax of 23% on the total value of the policy.
   
   If you wish to cash in your policy before the 5th anniversary or transfer it to another provider, there will be an administration charge of €30 (€23.40).



3. What are the projected benefits under this policy?
   Projected benefits will depend on the actual amount of premiums invested.Representative figures based on a monthly premium of €150 are as follows:-

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5. Are returns guaranteed and can the premiums be reviewed?
   Investment returns are not guaranteed. Investment markets can go down as well as up
   . However, if you invest in a Unitised With Profit fund the unit price cannot go down. A bonus may be declared at the beginning of each year. Your unit price increases in that year at that guaranteed bonus rate. However, when you encash units, we may need to make a market value adjustment. This can occur where a prolonged or extreme period of poor stock market performance coincides with requests for encashments from the fund. This adjustment is required to protect policy holders remaining in the fund. The adjustment reduces the value of the units in the fund.



6. Can your policy be cancelled or ammended by the insurer?
   We rely on you giving us accurate information when completing your application form. All this must be correct at the start date of your policy. If any information given is incorrect or incomplete this may affect your policy. We may cancel it or change it.
   
   We may alter the policy or issue another in its place if:
   
   
   1. It becomes impossible or impractical to carry, out the policy conditions because of a change in law or other circumstances beyond our control.
   2. The tax treatment of Hibernian Life & Pensions Ltd changes or we have to pay a government levy.
   3. It becomes impractical or impossible to administer the policy.

   If we alter the policy (or issue another in its place) we will send a notice to you outlining the change and your options.




7. Information on taxation issues
   An exit tax of 23% is due when the policy matures or upon early encashment.
   The tax paid on maturity or earlier death is 23% of the value of the policy, in excess of the value of the premiums you pay and any government contributions.
   
   If you encash the policy early you pay an exit tax of 23% on the total value of the policy.
   
   Hibernian Life & Pensions deducts this tax and pays it to the Revenue on your behalf.
   
   There is no income or partial encashments facility.
   
   The death benefit is subject to the above exit tax, and the proceeds may be subject to inheritance tax.




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8. Additional information in relation to your policy
   When you invest in Spectrum Special Saver, you have the option of investing in different funds. These funds are managed by Hibernian Investment Managers.
   
   Each of the funds has a different investment content. The investment content will consist of a selection of assets, incorporating one or all of equities, cash, bonds and property, both Irish and overseas. It will depend on the fund chosen.
   
   If for example you invest in the Balanced Managed Fund, your money in invested in a spread of equity, bond, property and cash assets. The mix of assets will alter according to the views of the fund manager.
   
   The funds you invest in should reflect your attitude to risk.
   
   You can switch your investment between our funds. The first switch in any year is free of charge. Subsequent switches have an administration charge of €20 (€15.75).
   
   When you effect your policy with Hibernian Life & Pensions your policy will be sent to your Financial Adviser. When you receive this policy you should ensure that you are satisfied with the benefits of the contract and that you understand all of its features. We advise you should read this documentation carefully when you receive it.
   
   If, after you have read your documentation, you feel that the benefits are not suitable for you particular needs, you may cancel your policy by sending a written instruction, signed and dated, directly to our Life Customer Services Department within a period of 15 days from the date of the issue of your policy. Upon cancellation all the benefits under the policy will stop immediately and any premiums remitted to Hibernian Life & Pensions will be refunded in full.
   
   The Insurance Contract between you and Hibernian Life & Pensions is based on the information given by you on your application form, a copy of which is available upon request. We rely on you to give us all the necessary information we need and we must reserve the right to treat your policy as void if any material facts have not been notified to us.
   
   Any enquiries or complaints regarding your policy should in the first instance be directed to our Life Customer Services Department. We will endeavour to ensure that all matters in relation to your policy are dealt with in a satisfactory manner. In the event that you are dissatisfied on any matter you have the right to refer your complaint to the Insurance Ombudsman without prejudice to your right to take legal proceedings.
   
   The information contained in this document does not form any part of the contract between you and Hibernian Life & Pensions and does not affect the legal rights and duties of either contracting party by virtue of the policy. The full details of your contract will be detailed in your policy document when the policy is issued.