Old Mutual International Managed Capital Account OMI MCA Review

Quick Summary from TailorMade

Unlike the Executive Wealth Account we think the OMI Managed Capital Account is similar to many in the offshore market place. Similar to the RL360 Quantum plan this type of plan may have been a common option in the UK back in the 1990’s but in 2015 it lacks the transparency of the latest plans available from territories such as the UK, the USA and parts of Europe; ultimately, the OMI MCA is an expensive option when compared with a pure platform plan.

Where it differs from OMI’s other offering is that the OMI MCA pays big commissions, which means that between the first 6 months and 2 years of premiums will be completely lost (penalty) if you attempt to access investments early. We think the non-commission variant Executive Wealth Account from OMI is better as it charges upfront and then does not apply exit penalties; it gets an extra star from this variant although it is expensive.

The standard OMI MCA funds have high ongoing fees when directly compared to platform or direct offerings from fund houses via the UK or the USA. You may not get back all of your savings with an OMI MCA and there are no guarantees that the portfolio will give you the returns you are expecting, but any attempt to take proceeds early in the plans life, or make it paid up, will result in access penalties or higher charges on the remaining invested funds, or both.

However, some people require help when making disciplined decisions and will welcome the fact that a plan is written to a set target date and cannot be accessed early without a surrender penalty; some people wish to deliberately lock-up their funds. Therefore, potential investors have to weigh up the benefits of locking up their investments and not having the flexibility to access their investment earlier without surrender charges applied.

NOTE: The OMI MCA is often also known as the OMI Managed Capital Account and it must not be confused with the OMI Executive Wealth Account plan; same company but 2 completely different structures.

The OMI MCA provides the option of lump sum commission to its distributors (in the industry this is called indemnified or up-front commission) and it has a successful network of distributing agents throughout the world excluding the main regulated territories. The amount the distributor earns is linked to the length of the policy; the longer the policy term the longer the surrender penalty incurred on early access, the more money the distributor or adviser earns. Not all distributing agents have regulation or financial qualifications and may not be aware of the other saving plan options available.

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.