"My IFA asked about my attitude to risk and I said risk averse and cautious. Well he recommended the PRU Flexible Life Time Annuity adopting the "Cautious" strategy. The good point about this policy is that it allows me to convert to an annuity at any time before 85 (I think) as it is somewhere between a drawdown and an annuity. I can vary my pension payments between 50 and 100% as well.

Well, the policy is NOT Cautious at all and has spread the funds into mostly a WP and Managed portfolio. The Managed portion has sunk by around 30% in the 11 months I have had it, and the WP element has had 3 (yes 3) reductions announced in 2002 since I started it.

All at a time when the Pru boasted they had seen the share fall coming and they had moved into bonds. So I can move the managed portion out without MVA (but it is already 30% lower than I had thought it would be), the WP element is now subject to a variable MVA (published at between 5 and 10%, but when it comes to me it is higher than 15%). The other assumption, that the brochure gives you is that you can self manage the funds (there are around 11 to chose from). However, the pricing information (to the IFA only) is only historic (until yesterday it was still showing last years prices) and only for the non-WP portion.

I cannot tell how many units I have either, so the self management idea is a complete nonsense as far as this policy goes (even with IFA access). Additionally each year the IFA gets commission for helping me manage the policy, what a joke. He started with I think a 3% commission at the beginning, but the charges just keep coming each year. The only way this policy would generate enough to keep my pension going is in a raging bull market! So much for something that is risk averse and cautious!

A friend has given me access to the PRU IFA site, and I can see it clearly indicates the fund is a (high?) risk solution. However, all the sales brochures do not mention this and the IFA guidance as to who to sell this to ignores the risk aspect altogether! However, I think the IFA is the one I should sue for mis-selling! No wonder the PRU has a solid financial reputation, it gives large amounts of policyholders money to IFAs to encourage selling dubious products, the IFA has all the legal responsibility and the policyholder has all the risk. The Pru meanwhile just levies charges."

(Motley Fool, Equitable discussion board, 31621)