In uk.finance judith wrote:

Now call me old fashioned but if I was looking to invest some money in
a plan called : "Norwich Capital Protected Plan" - then I would have
thought that my original investment ie my Capital would be
"safe"/"protected"/"guaranteed".

Bear in mind that any such investment is eroded by inflation so, while
you might have the same number of pounds as you started with, you won't be
able to buy as much with the money as you could when you invested it.

However, what that sentence should say is:

"What you get back depends on how your investment grows and on the tax
treatment of the investment, and on whether the company from who we
purchase the corporate bond is still in business"

That sounds a bit odd - the point of corporate bonds is that there's a risk
the company might default; otherwise they'd be a dead cert for income.
There must be some difference between this and a plain old corporate bond
fund.

As elsewhere it does say there is a possibility that the company
(providing the bond) could fail or become insolvent, your investment
could be at risk, and you could lose some or all of it.!!

Are you sure that's related to your plan specifically? It might just be
generic boilerplate language for all the investments listed of which the
Capital Protected Plan is only one.

I don't know what NU do, but usually Guaranteed Equity Bonds have some other
mechanism in place (autocalls, preference shares etc) to guarantee the
capital. This seems to be the case if this is the plan:
http://www.norwichunion.com/press/st...pital-plan.htm

If NU goes bust then I think you're covered up to 48,000 by the FSCS. I
don't know what happens if the fund is managed by someone else and they go
bust.

BTW, you do realise that 33% of it is linked to house prices? This might be
a riskier time to invest on that front, as they have to rise by 26% over 6
years to keep up with inflation at 3%.

Theo