Personal Finance Digest

AIB has introduced a new online travel insurance product that is, on average, 50 per cent cheaper on single trips and 36 per cent cheaper on annual multi-trip policies than its current offering.

Cover for a two-week holiday in Europe costs €43 for two adults and up to five children under the online policy, which is underwritten by ACE Travel Insurance. This compares with a quote of €82.28 under AIB's normal travel insurance policy.

However, the same policies are available directly from www.acetravelinsurance.ie for less. Two weeks' cover for a family holiday in Europe costs €33-€10 cheaper than through the AIB website. Similarly, a worldwide multi-trip policy for a couple costs €107 through AIB, but just €92 directly from ACE.

IBF unhappy at review proposals

Proposals made by the EU Commission under its review of consumer credit law are "overly prescriptive", according to the Irish Bankers' Federation (IBF) and its affiliate, the Irish Mortgage Council (IMC).

The groups fear that the amount of information that must be provided to consumers will be "unhelpful". Consumers are empowered through information and transparency, the IBF says, but information overload decreases consumers' opportunity to focus on the pertinent points.

The IBF is also concerned that the proposals do not allow consumers to waive their right to a 14-day "cooling-off" period. The inability to do so will likely result in institutions not issuing any credit to the consumer until the full withdrawal period has elapsed. This would mean that no consumer could obtain immediate credit.

Ninth PRSA provider approved

A ninth company has been approved by the Pensions Board as a provider of personal retirement savings accounts (PRSAs).

Custom House Capital, an investment intermediary firm, will sell a non-standard PRSA to high net-worth clients. It is the only company of its size to apply and receive approval for selling PRSAs.

Moneywise warns on pension target

Increasing pension scheme membership from 50 per cent of the workforce to the Government target of 70 per cent will not diffuse the pensions time bomb, according to a commentary from authorised advisers, Moneywise Financial Planning.

Moneywise says that employer contributions to the new personal retirement savings accounts are likely to be the catalyst for success. But the financial advisers warn that, without any compulsory requirement for employers to contribute, it is unlikely that a satisfactory number will take up the responsibility to boost pension benefit levels.

€10,000 minimum for new tracker

Irish Life has launched a new series of tracker bonds under its World Titans Portfolio Bond for investors with a minimum of €10,000.

Investors can receive a capital guarantee of either 90 per cent, 100 per cent or 106 per cent over a term of five years, 11 months. A cash-in facility allows investors to access their investment at its market value at any stage for a charge of 1.5 per cent in the first four years, reducing thereafter.

Uncapped return on ACC bond

ACCBank's tracker bond, Solid World Dual Bond 2, has an uncapped return rather than a 60 per cent maximum return as stated in a table last week. The return is based on 60 per cent participation in any growth in the companies it tracks.

This means if they grow by 300 per cent during the term, investors receive 180 per cent.