Only one in 100 financial advisers still think insurance bonds are the best place for their clients to put their money.  It used to be one in three. Almost half of all advisers with clients who have insurance bonds are considering reviewing their policies, with a view to switching them where appropriate into mutual funds, and a further 26% are wondering whether they should do the same.
 
These are the findings of a survey of more than 230 advisers by Fidelity FundsNetwork. Fidelity's fund platform, which offers advisers and their clients the ability to invest, manage and monitor their investments in one place.

"It was encouraging to see the survey reveal that 90% of advisers understood that the decision whether to use a life bond or a mutual fund can have a substantial impact on the investor's ultimate return,” said Paul Kennedy, Head of Trusts & Tax Planning Solutions, Fidelity FundsNetwork.

“Almost, 100% of them recognised the value that this tax planning adds to their investment service, and not a single respondent thought tax considerations were irrelevant.

“As we know, recent changes to CGT haven't fundamentally changed the taxation of bonds and mutual funds, but they have acted as a catalyst to re-focus minds on the appropriate use of mutual funds. There remains a place for both wrappers.  It is only proper that advisers continually review existing investment and where the case merits, make relevant switches, whether assets or tax wrappers. There are many things that will need to be considered, and I'm sure that advisers will only recommend a switch from a bond to a mutual fund where it is in the genuine interest of the client."

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