Secure Lifetime Income (SLI) video guide

Intro

We have partnered with retirement specialists Just to provide you and your clients with access to their Secured Lifetime Income product (or SLI for short) within a 7IM SIPP. This video will show you how this SLI works on our platform, including how you can quote and apply online. For more about the features of this product and where, or how, it might be used, please see our dedicated web page and accompanying literature or get in touch with us to discuss further.

As the SLI is provided by Just, all quotes, applications, and underwriting are handled by them. But all this is done online through their SLI portal (called Spire) which you access via the 7IM platform as we shall now go through.

Access

There are two ways in which you can access the SLI Spire portal from our platform.

To get a quote for a client who does not yet have a 7IM SIPP, you can go to Retirement Services > Secure Lifetime Income and then click the Proceed button which will open the SLI portal in a new window.

Please note that any quotes you generate via this route will not be saved once you leave the Spire portal.

To quote or apply for a client who does already have a 7IM SIPP, go into the client account area and click on the SLI tab on the right and then click on Quote or Apply.

Taking this route to the Spire portal will pull through the client’s details (such as name and date of birth) so that the quote is personalised for that client without you having to rekey any of this information.

Quotes

Once you are in the SLI portal there are two types of quote that you can get:

• Ball Park Estimate
• Accurate Quote

Ball park estimates are a quick and easy way for you to get a rough idea of the income level for a given amount of capital or the capital required for a given level of income.

These estimates use one of three example health profiles so you can choose which one most closely represents your client without needing their medical details. While getting a ball park estimate can be a useful first step in the process to begin a discussion with a client, or to start to formulate a plan, we would recommend getting an accurate quote wherever possible.

An accurate quote, as the name suggests, requires more detail about the client’s health so that the quote is personalised just for them.

There are two ways this health information can be captured. Either you can answer the health questions online on behalf of the client by clicking on the Start button, or you can ask your client to complete this health questionnaire themselves by clicking on the Send To Client button.

Choosing this second option will send an email to your client with a link to the online portal so they can complete the questions online and you will get a notification once they have done so.

Please note the Send To Client option is only available if you access the Spire portal via an existing 7IM SIPP client as it requires the client details.

The health questions are in two parts. Firstly there are some lifestyle questions. Then there is a section about any medical conditions the client might have. If the client has no medical conditions, you can click the “No medical conditions” button to answer no to everything in one go.

Once you or your client have answered all the health questions you can proceed to the quote section.

From here you can choose what basis you want the quote for.

• Quote for income will show you the capital required for a given level of income.
• Whereas Quote from Premium will show you how much income the client can get for a given amount of capital.

When you’ve made your selection and input the amount, click Request Quote.

The quote details will then be displayed on screen.

You can now download two separate documents:

• SOF is a statement of facts which replays the answers to the health questions from the previous section, if you have done an accurate quote.
• Q is the personalised SLI quote showing the income and premium level along with death benefits and encashment values and over time.

Remember that when you return to this section to view previous quotes, they will be saved under either the Quote for income or Quote from Premium tabs so make sure you choose the right tab first to see the relevant quotes.

Apply

You can apply for the SLI online on behalf of your client by accessing the SLI portal via the client account area on our platform as we described earlier.

However before you apply you should ensure that all these criteria are met:

1. Your client has a 7IM SIPP
2. Your client is 55 or over
3. Your client has a UK address
4. The 7IM SIPP has sufficient crystallised value to cover the SLI premium
5. The 7IM SIPP has sufficient cash in the D portfolio to cover the SLI premium
6. The SLI quote is still valid (ie within 35 days since it was run). You can always requote to get a new one, although the figures may change.

Assuming all these criteria are met, you can click on the Apply button below your chosen quote to make the application.

At this stage you will be asked to provide details of the client’s GP.

Once you have applied, you can then return to the 7IM platform.

On the 7IM Platform you will be able to see the status of the application in the SLI tab in the client account area. It will show as In Progress to begin with and then Complete, and you’ll also be able to see the Just policy reference on the left side as well as all the amounts relating to that SLI.

Income

Once live, the income from the SLI will be paid by Just into the client’s 7IM SIPP on the 1^st of each month, a bit like income from an investment. It is therefore up to the client what they do with this cash from that point as it does not have to be immediately withdrawn.

For example, this SLI cash could form part of a larger income withdrawal utilising the other assets in the client’s SIPP as well. The client can decide on their total income withdrawal from their crystallised 7IM SIPP in the usual way.

Remember that if the client wishes to start or amend their income from a crystallised 7IM SIPP you will need to send us a completed Pension Income form which is available to download from our Literature Centre. And if the client wishes to crystallise some, or all, of their 7IM SIPP to take tax free cash and start an income, you will need to send us a completed Taking Benefits form which is also available to download from our Literature Centre.

Also, please note that if you intend to use SLI in conjunction with a drawdown payment date of the first of each month, you should start the SIPP income the month after the SLI income starts. This is because we receive the income from Just on first of each month, by which time our first of the month payroll income will have already been paid out to clients. So starting the SIPP income the following month allows enough time for the SLI cash to be applied to the client’s SIPP ready for next month’s payment.

Ongoing values

The SLI also has a lump sum encashment value for a period of time. This will start at 75% of the premium amount and then reduce over time until it reaches zero. For more about this, please read our SLI guide or the personalised SLI quote document you get from the Spire portal which we mentioned earlier.

This encashment value will be included in the value of your client’s 7IM account and will therefore incur both 7IM platform charges and any adviser fees during this time.

The current encashment value of the SLI will be displayed in the Positions tab of the client’s account on platform as a separate asset line. This value will also be included in the client’s quarterly 7IM statement, the ad-hoc client review reports (or CRRs) and the client online portal.

Please note, however, that it won’t be included in the holdings shown on our 7imagine app.

The SLI encashment value won’t be included in any rebalance or proportional sale calculations which means it can be held in the client’s D portfolio alongside any other assets, including a model portfolio, without impacting on the trading that happens in that account.

Finally, there is a firm level SLI report available on our platform in the Practice Administration menu that shows all the active SLIs that any of your firm’s clients have. This report will show the details of each SLI including the income level, current encashment value, the premium paid and the application date.