Avc risks

[Rapido123]

Hi, currently in the process of reviewing my Avc and looking at moving some of my funds to the cash fund. I was looking through the fact sheets on the cash fund and noticed a paragraph which I found a bit concerning it is also on the growth fund fact sheet and probably on all of the fact sheets for the funds provided by money 4 life.
The paragraph is shown below

All or some of the investments are made through a reinsurance arrangement so if the linked life insurance company/ies) were to fail you may lose some or all of your money and this will not be covered by the Financial Services Compensation Scheme.

Could somebody please advise if they have any idea if I should be concerned about this. I have been in touch with the pension service centre but they have never heard of this even though it is on the fund fact sheets, thank you

[yellowbelly]

Hi, currently in the process of reviewing my Avc and looking at moving some of my funds to the cash fund. I was looking through the fact sheets on the cash fund and noticed a paragraph which I found a bit concerning it is also on the growth fund fact sheet and probably on all of the fact sheets for the funds provided by money 4 life.
The paragraph is shown below

All or some of the investments are made through a reinsurance arrangement so if the linked life insurance company/ies) were to fail you may lose some or all of your money and this will not be covered by the Financial Services Compensation Scheme.

Could somebody please advise if they have any idea if I should be concerned about this. I have been in touch with the pension service centre but they have never heard of this even though it is on the fund fact sheets, thank you

I would imagine it's a 'catch all' statement for covering their arses if somewhere in the investments there is a company that's another potential Barings/Enron/Lehman BrothersI/AIG just waiting to happen.

[heapsy]

Not seen the paragraph you refer to, but tbh, I wouldn't worry too much. I've started paying in to the Cash fund with both Bonus and Flexi plans. I intend to retire at 60, so I want a bit of stability with my investments as 60 gets closer. Especially when the new pension comes in, as we wont be able to pay any more into them and will have less time to do anything about a sudden crash in value. My mate took a pay off back in March. Since then, he's moved his AVCs in to the Cash fund, as he is no longer contributing to any of the pensions or AVCs.