The investment element (The "ICA")

The investment element

Our Holloway product is Income Protection with a difference - we also pay back to our members any Surplus we make by way of apportionments to an Individual Capital Account (ICA). This is what we call the investment element.

How does it work?

Every year the Society calculates its "Surplus". "Surplus" is the Society’s Subscription plus Investment Income less the Sickness Claims we pay, the Statutory Reserves we must hold to ensure that the Society remains Solvent and the expenses of running the Society - effectively what a non Mutual organisation would call profit.

What are Shares and Units?

The Weekly Benefit for which you subscribe is made up from "Shares" and "Units" each of which accounts for 60p per week of Income Benefit. You can select from one of three ratios of Shares to Units - 1 Share for every 4 Units, 1 Share for every 12 Units or 1 Share for every 20 Units. These are the Share to Unit Ratios referred to above in your options. We apportion an allocation of our Surplus to each of our members every year based upon the number of Shares (NOT Units) each member holds. Since only the Shares have the investment entitlement vested to them, they are consequently more expensive than Units.

Shares are not like shares on the stock market - they are for internal purposes only. You cannot trade any Shares or your ICA.

The balance of your ICA (the interest and bonus apportionments built up over the length of your membership) is only payable when you resign or retire from the Society. Subject to your individual circumstances, this balance is paid to you free of personal income and capital gains tax under current legislation, and is how we give any profits we make back to our members. However, please note that penalties will apply to your accumulated balance if you cancel your membership prior to your sixtieth birthday, and that no balance is payable if you cancel your membership within your first two years of membership.

Please read the Key Features Document or Contact us if you require further explanation.