Q. What is Riley?
Riley is a life insurance bond for a minimum investment of £10,000. Your clients may not get back the full amount of their investment
Q. How does Riley work?
Riley gives your clients the potential to participate in stockmarket returns while giving them the option to protect their investment at a level, and time, to suit them. Each investor essentially has an individual put option purchased on their behalf to ensure that the value of their holding in the Stockmarket Fund will be at least equal to their Protected Amount. This individual option is managed on investors’ behalf by Royal London and will have a daily value all through its life until the chosen protection date. A put option gives its owner the right (but not the obligation) to sell a particular asset at a particular price and. In this case of Riley, this is designed to finance any deficit between the Protected Amount and the bond value.

Remember that the stockmarket goes up and down and returns are not guaranteed
Q. How is this product different to other similar products on the market?
The ability to structure Riley to provide personal levels of protection at a time of your clients' choosing is a first in the protected investment arena.  This is bolstered by the flexibility to change these elements at any time.
Q. Can I recommend Riley for my new clients?
As from 30 October 2008, we have temporarily withdrawn the Riley bond from the market. This affects new business and increments to existing business. The recent extreme and unprecedented levels of stockmarket volatility have resulted in a significant increase in the cost of protection. We will continue to monitor the situation carefully and will seek to re-open the bond to new business once the cost of protection has returned to more normal levels. It is impossible to say when that will be but we will contact you again in due course.
Q. Can existing policies lock in gains?
Currently, existing policies cannot lock in gains. This is because the recent extreme and unprecedented levels of stockmarket volatility have resulted in a significant increase in the cost of protection. Due to this, bond holders cannot increase their bond's protected amount. The cost of protection is monitored on a regular basis and we will seek to allow gains to be locked in once the cost of protection has returned to more normal levels. It is impossible to say when that will be at the moment.
Q. What type of investor would this product be suitable for?
Riley is specifically aimed at cautious investors who wish to get at the stockmarket, but insure against the effects of the downs.
Q. Why have you chosen the FTSE 350 as the basis of the investment element?
Many commentators believe that the FTSE 100 is a narrow index, dominated by a small number of sectors. Extending our link to the wider index gives investors the opportunity to access a much wider spread of companies.
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Q. Why are there only two fund choices? Advisers are used to having much more choice.
Choice does not improve the client proposition and our testing with potential clients reinforced that.
Q. Why have you chosen Schroders as the fund manager of the active fund, rather than RLAM?
Schroders’ pedigree in managing UK equities on behalf of clients is renowned. We want to harness the best available supplier for each element of Riley. Schroders clearly fit into that category.
Q. What experience does RLAM have of running index-tracking funds?
Having one of the Royal London Group’s companies managing the tracker fund means we can offer a compelling value-for-money alternative to the actively managed FTSE 350 fund. RLAM will be managing the fund to a tight tracking error.
Q. Do you expect people to review their investments on a regular basis?
We hope so. Riley has been developed mindful that people’s circumstances do change as, of course, do stockmarkets – and people’s views as to their likely performance.  Riley offers the opportunity to reflect changing needs, and views, without the requirement to cash-in the bond or move it elsewhere.
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Q. How will you communicate with customers to keep them up to date with their investment’s performance?
Clients will receive an annual statement in a simple to understand format and can register to obtain up-to-date valuations online at any time.
Q. Can people lock in growth as they go along?
Yes they can. Riley’s flexibility means that the Protected Amount and date can be changed at any time, so giving investors the opportunity to increase the Protected Amount to lock-in gains, subject to certain maxima.
Q. Why did you choose such a distinct brand for this product?
A distinct brand is ideal for such a distinctive product.

Riley gives us the opportunity to develop clear client marketing material and explain the proposition in a straightforward, engaging way.
Q. What work have you done in assessing client suitability for Riley? (Given that this is now a major ‘Treating Customers Fairly’ issue for advisers)
We undertook two major client opinion exercises, testing the proposition and its marketing for understanding. This encompassed investors of varying age, background and location. The results were used to help shape the final proposition and have proved invaluable in the development phase. This is the start of our TCF activity for Riley.
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