What is an investment bond?

An investment bond is a single premium life insurance policy and is a potentially tax-efficient way of holding a range of investment funds in one place.

You can usually buy investment bonds from life insurance companies and they can be a good way of allowing you to invest in a mixture of investment funds that are managed by professional investment managers.

Each bond is usually designed to provide benefits for different types of investors but a common element is that they aim to produce long term capital growth and/or generate a long-term return.

There are often minimum investment levels that may range from £1,000 upwards and can typically be set at £10,000.

When you invest in a bond you will be allocated a certain number of units in the funds of your choice or those set out by the conditions of the bond.

Each fund will invest in a range of assets and the price of your units will normally rise and fall in line with the value of these assets.

Investment bonds are single premium life insurance policies, meaning that a small element of life insurance is provided. This is paid out after your death.

What are the main benefits of an investment bond?

• Regular withdrawals can be taken.
• You can choose to invest in a range of funds, you can choose a portfolio, or you can choose a mixture of both.
• You can usually switch between funds within your bond.
• Tax planning benefits.

Prudential's investment bonds

Prudential offers several investment bonds giving you access to a wide range of investments.

To find out more about the funds you can invest in read our investment bonds fund range.

Note that the value of your investment can fluctuate and you may not get back the full amount of your investment.