Old Mutual International OMI Executive Wealth Account Review



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OMI Executive Wealth Account Review ☆☆☆☆☆ 0
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logo-roundel TailorMade Ratings:

Fund Access 2.5 / 5

50%

Charges 2.0 / 5

40%

Accessibility 4.0 / 5

80%


thumbs upPros

  • Good company rating
  • It is possible to take out a non-commission plan with up front charges
  • It could be considered for a 5 years investment term where no withdrawals required
  • Offers some tax protection in certain jurisdictions


thumbs downCons

  • If taken out without commission then this offers an advantage over many other options but up front charges are high
  • Does not provide full access to lowest cost funds and passive trackers
  • Difficult to obtain the non-commission product which remains an extremely expensive option
  • Many countries do not recognise any tax concessions

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Old Mutual International (OMI) is a huge South African and London listed insurance company that has specialised in offering a wide variety of investments within its products. Prior to 22 December 2014 the company was known as Royal Skandia before changing it’s name to OMI. OMI operates globally and for many years was a trend setter offering the option of building portfolios and utilising funds from multiple fund managers and providers. This review focus is on the Executive Wealth Account.

Old Mutual International (OMI) is made up of three companies:

 

  • Old Mutual International Isle of Man (previously Royal Skandia)
  • Old Mutual International Ireland (previously Skandia Ireland)
  • Old Mutual International (South Africa)

 

OMI offers different products in different regions and some of the products available in the UK are very good. However, this review is based on the Dublin / IOM based Offshore Old Mutual International (OMI) Executive Bond products exclusively. OMI provide investment solutions for expatriate and local customers around the world, including Africa, Asia, mainland Europe, Latin America, the Middle East and the United Kingdom. Old Mutual International (South Africa) provides an investment product to South African residents through Old Mutual Isle of Man, a branch of Old Mutual Life Assurance South Africa (OMLACSA).

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Policy Currency: The OMI Executive Wealth Account may be denominated in US dollar, GB pound, Hong Kong dollar, Japanese yen or Euro. Benefits will be paid in the plan currency.
Why choose the OMI Executive Wealth Account: Over 40 Leading Fund Houses offer a wide choice of over 370 investment funds. You choose from a wide range of risk-rated funds covering all the major world markets and investment classes. The funds section contains performance statistics which are updated monthly, fund prices which are updated daily and Fund Fact Sheets on each fund
OMI Executive Wealth Account promotion: What does Old Mutual write about their own OMI Executive Wealth Account? OMI Executive Wealth Account is a quality product for those who wish to save for their future regularly but flexibly – perhaps to supplement savings outside of a pension or other tax-advantaged vehicles. It provides the potential to build up cash for substantial future expenditures, such as paying school or university fees, or supplementing income in retirement.
Eligibility: The OMI Executive Wealth Account is a regular premium, whole of life, life assurance contract issued by Old Mutual International. You can set up a policy in 1 of 7 currencies including Pound sterling (GBP), Euro (EUR), United States dollar (USD) Swiss franc (CHF), Australian dollar (AUD), Hong Kong dollar (HKD) and Japanese yen (JPY)
Minimums: Minimum is £500 per month ( or equivalent in other currencies ), lump-sum payment can be made in any freely convertible currency and has a minimum of £1,000. You can make additional lump-sum payments into your policy at any time. However your will pay any initial fund charges on all contributions. You can pay premiums via a number of different methods including credit card. There is no additional cost if you do choose to pay by card.
Charges:

Charge Structure: There is an initial bid/offer spread of 7% as a one-off charge for all monies invested. Once invested, this spread is not applied on fund purchases.

Annual Policy Charges: There is an annual 1% policy charge of the value of your fund to cover management costs.

Other Charges: There are also fund management charges, usually 1% to 2.5% pa each year- depending on the funds chosen. Additionally there may be an adviser charge to manage the portfolio, this typically can be between 1 to 1.5% per annum depending on the chosen advisers charging structure and service provided.

Are charges explicit: By explicit, it means that it is clear to see not only the charges for taking out the plan but also the cost of funds annually, any upfront fund costs, penalties on access, etc. Yes, in the main the OMI Executive Wealth Account charges are clearly shown and any professional should be able to interpret them.

Surrender of the OMI Executive Wealth Account: A surrender on your OMI Executive Wealth Account may be treated as a one-off withdrawal. Further details on how it is treated is available in the relevant brochure. If you cash-in your policy during at any time, there are no surrender penalties or charges
There is also no lock in as you have paid up front the charges.

Documents

Old Mutual International EWA At a Glance
Old Mutual International EWA Account Terms
Old Mutual International EWA Application Form



Quick Summary from TailorMade


Old Mutual International (OMI) has a great reputation The OMI Executive Wealth Account is not the same as the many regular savings plans in the offshore market place.

This is a fee based plan that does not apply the large commission payments to advisers that most of the other plans feature. It is very rarely recommended by advisers, although in the absence of the ability to access pure custodian or platform plans, it should be considered; It can offer some advantages with its protection against tax charges in some territories.

The down side is the cost up front which is nearly 8-10% on every premium. Access comes at a cost! The benefit is that if you only want a short term plan or want the flexibility then you have to pay up front; ultimately, the OMI Executive Wealth Account is an expensive option when compared with a pure platform plan and we would put others ahead of it.

The standard OMI Executive Wealth Account funds have high ongoing fees when directly compared to platform or direct offerings from fund houses via the UK or the USA.

NOTE: The Old Mutual International OMI Executive Wealth Account is suitable for some regular savings planning especially where tax efficiency may be required and it does not have surrender penalties. The OMI Executive Wealth Account must not be confused with the OMI MCA plan; same company but 2 completely different structures. We do not think this type of plan should be sold as a pensions saving product offshore.

WARNING: Costs and information is correct as of July 2016. Please refer to a brochure from the company for current up to date information and any changes on costs or information. You should not buy based purely on information contained within this article and EME do not accept liability for purchases. If you have any doubts then please speak with your financial adviser or a representative of the company for further advice.

If the provider improves or amends its terms then EME would like to hear from them to amend the review page accordingly, and providers are encouraged to comment on errors or omissions to ensure that readers have the latest and correct information.




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1 / 5

Charges Overall charges greater than 8% per annum.
Funds Limited selected range of collectives or mirror funds with upfront additional charges (Bid/Offer spread) or initial “capital” units.
Accessibility To avoid access penalties, only accessible after establishment period of 8 years or longer, or total loss of fund or severe penalties in establishment period of 12-24 months or longer.
Overall Assessment A commission-based adviser’s product. Not recommended under any circumstances.

2 / 5

Charges Overall charges greater than 5% per annum.
Funds In-house range of collectives or mirror funds with upfront additional charges (Bid/Offer spread).
Accessibility Penalties resulting in loss of fund value may exist for 5 years – 8 years, or total loss of fund or severe penalties in establishment period of 12-24 months or longer.
Overall Assessment A predominantly commission-based adviser’s product with limited use or appeal.

3 / 5

Charges Overall charges between 2.5% and 5% per annum.
Funds In-house or limited range of collectives or mirror funds with no Bid/Offer spread.
Accessibility To avoid access penalties, only typically accessible after establishment period of 12-24 months or longer, but with no penalties thereafter.
Overall Assessment For those seeking lock-in target dates (perhaps with guarantees) over 5 years.

4 / 5

Charges Overall charges less than 2.5% per annum.
Funds Full range of collectives with no Bid/Offer spread and rebates on charges reducing annual costs.
Accessibility Immediate within 60 days without any penalties on any item.
Overall Assessment Recommended for some situations and some people.

5 / 5

Charges Overall charges less than 1.6% per annum.
Funds Includes ETPs (passive) and Individualised accessible collectives with no Bid/Offer spread and clean share classes for lowest annual costs.
Accessibility Immediate within 30 days without any penalties on any item.
Overall Assessment Recommended for most situations and most people.