In terms of legislation, one loan and one withdrawal is permitted during the first five years. The sum of these may not exceed the contribution plus 5% p.a. compound interest.
Liberty Life's business practice is as follows:
* No advance (either a loan or a withdrawal) is allowed in the first year;
* Only one advance is allowed in the first five years;
* Advances are restricted to a maximum of 90% of the investment value less charges at the point in time the advance is taken, less any previous advances made.
* After an advance has been taken, the contract may be surrendered on the following basis:
o If only a portion is accessible (in terms of legislation), such a request will be treated as a part-surrender.
o If there is no accessible amount, then no further access will be allowed until the expiry of the restriction period.
* Any advance (loan or part-withdrawal) taken within the initial term of the policy is subject to a surrender charge.
After the initial five-year period, the investor is able to make as many advances(loans or part-withdrawals) from the contract as he wishes, provided that the total amount does not exceed 90% of the investment value, less any previous advance made and that the remaining value in the investment account is greater than R600.
Advances are proportionately taken from each investment portfolio that the contract is invested in. In the case where the investor allocated his monies to a guaranteed portfolio, the guarantee will fall away on the proportion taken as an advance.
The advance (either a loan or part-withdrawal), within the initial term of the policy, is subject to the Surrender Administration charge of R250. (See charges). There are no further surrender charges.
