Smoothed Return Announcement

In 2024, the ability of our multi asset, globally diversified With-Profits Fund gave us the advantage to be able to seek out and benefit from opportunities across a wide range of different asset types. The Fund was able to invest across different regions, in both public and private markets, in which many saw growth despite uncertain economic conditions. As a result, a positive return of 7.3% (gross of tax) was achieved before charges and the effects of smoothing*.

In 2025, our With-Profits Fund managers will continue to evolve portfolios and capture new investment opportunities from around the world. Our managers aim to secure the highest total return for the Fund (after any tax and investment expenses) while maintaining an acceptable level of risk and protecting our customers.

*This describes the main asset pool in our With-Profits Sub-Fund, which is relevant to all of our Income Choice Annuity customers. Please see information specific to your Plan to find out more.

We aim to ensure those with an annuity get their fair share of the With-Profits Fund's investment returns via the announced Smoothed Return. In addition to the investment returns on the Fund, the Smoothed Returns we announce depend on several factors including:

the effective date of the annuity
how we expect investments to perform in the following months
our views on mortality
adjustments for smoothing
the Plan's charges.

The announced Smoothed Return can be changed and isn't guaranteed until it's due to be paid on your clients next Plan anniversary. It could even be negative, for example, if stock markets perform badly. The effect of the Smoothed Return we announce on your clients income is included in their yearly statement. This webpage explains the 2025 Smoothed Return Announcement for the Income Choice Annuity.

See the bonus declaration for the With-Profits fund.

On the Bonus Declaration literature page, you will find literature and sales aids that you can use to discuss bonus declaration with your clients.

How does this affect the Income Choice Annuity product?

	Effective Date (Annuity Start Date)
Announced Smoothed Return Year	09/03/09 to 05/04/09	06/04/09 to 05/04/10	06/04/10 to 05/04/11	06/04/11 to 05/04/12	06/04/12 to 05/04/13	06/04/13 to 05/04/14	06/04/14 to 05/04/15	06/04/15 to 05/04/16	06/04/16 to 05/04/17	06/04/17 to 05/04/18	06/04/18 to 05/04/19	06/04/19 to 05/04/20	06/04/20 to 05/04/21	06/04/21 to 05/04/22	06/04/22 to 05/04/23	06/04/23 to 05/04/24	06/04/24 to 05/04/25
2025	8.0%	7.5%	7.5%	8.0%	7.5%	7.5%	7.5%	7.0%	7.5%	7.5%*	7.0%*	7.5%*	7.5%*	7.5%*	7.5%*	7.5%*	7.5%*
2024	6.5%	6.0%	6.0%	6.5%	6.0%	6.0%	5.0%	5.5%	6.0%	6.0%*	5.5%*	6.0%*	6.0%*	6.0%*	6.0%*	6.0%*
2023	2.0%	2.0%	2.0%	2.0%	2.0%	1.0%	1.0%	1.0%	1.0%	1.0%*	1.0%*	1.0%*	1.0%*	1.0%*	4.5%*
2022	19.0%	19.0%	15.0%	15.0%	14.5%	14.5%	14.5%	14.0%	14.0%	10.0%*	10.0%*	10.0%*	10.0%*	9.0%*
2021	5.0%	4.0%	2.5%	2.5%	2.5%	2.5%	2.0%	2.0%	2.0%	0.5%*	0.5%*	0.5%*	4.5%*
2020	17.5%	15.5%	13.0%	13.0%	13.0%	13.0%	13.0%	12.5%	12.5%	6.5%*	6.5%*	4.5%*
2019	2.5%	1.0%	1.0%	1.0%	1.5%	1.5%	1.5%	1.0%	1.0%	1.0%*	4.5%*
2018	12.0%	11.0%	11.0%	11.0%	11.0%	11.0%	9.5%	8.0%	8.0%	6.0%*
2017	10.0%	9.0%	8.0%	8.0%	8.0%	8.0%	7.0%	6.0%	6.0%
2016	5.0%	5.0%	4.0%	4.0%	3.5%	3.0%	2.5%	5.0%
2015	8.5%	8.5%	7.0%	7.0%	6.5%	6.0%	5.0%
2014	8.0%	7.5%	6.5%	6.5%	6.5%	6.0%
2013	6.0%	5.0%	4.5%	4.5%	6.0%
2012	7.0%	6.5%	4.5%	6.0%
2011	9.0%	7.1%	6.5%
2010	8.5%	7.1%
2009	7.1%

*This applies to customers originating from our Flexible Lifetime Annuity (FLA) only.

Source: Prudential

Past performance isn’t a reliable indicator of future performance. Changes in the income payable from an Income Choice Annuity will depend on the relationship between the Smoothed Return announced and the Required Smoothed Return needed to maintain the customer’s chosen income. The income from an Income Choice Annuity can fall as well as rise at each plan anniversary, subject to any guaranteed minimum level of income (known as the Secure Level) that applies. The Smoothed Return can be changed and it’s not guaranteed until it becomes payable at the next plan anniversary.

Our Smoothed Returns include, where applicable, additional money we shared with our Income Choice Annuity customers as part of last year’s Bonus Declarations. Our Smoothed Returns aren’t guaranteed. There’s also a chance we might have to take back the additional money distributed (in previous years) in the future, to protect the interests of all customers. Unless something very unusual happened, we wouldn’t expect to have to do this.

Related Content

PruAdviser – With-Profits bonus rate

We have a summary of the 2025 annual bonus rates and with-profits declaration that you can share with your clients. Find out more here.

Learn more

"Prudential" is a trading name of Prudential Distribution Limited. Prudential Distribution Limited is registered in Scotland. Registered Office at 5 Central Way, Kildean Business Park, Stirling, FK8 1FT. Registered number SC212640. Authorised and regulated by the Financial Conduct Authority. Prudential Distribution Limited is part of the same corporate group as the Prudential Assurance Company Limited. The Prudential Assurance Company Limited and Prudential Distribution Limited are direct/indirect subsidiaries of M&G plc which is a holding company registered in England and Wales with registered number 11444019 and registered office at 10 Fenchurch Avenue, London EC3M 5AG, some of whose subsidiaries are authorised and regulated, as applicable, by the Prudential Regulation Authority and the Financial Conduct Authority. These companies are not affiliated in any manner with Prudential Financial, Inc, a company whose principal place of business is in the United States of America or Prudential plc, an international group incorporated in the United Kingdom.