The insurance giant confirmed it has put a “temporary” ban on customers withdrawing money from its bonds if part of their investments are held in commercial property funds.
Last month, five of the largest UK property authorised investment funds (Paifs), among others, suspended trading in the wake of market volatility caused by the Brexit vote.
The insurer said the freeze on withdrawals was down to “how part surrenders are processed on our system,” explaining that it is working to “resolve the issue as possible”.
“The restriction comes into place as a result of property funds being suspended for trading or deferring withdrawals. The timing of the bond restriction coincides with the restrictions on the fund or funds,” said a Standard Life’s spokesperson.
“We are liaising with the small number of customers and advisers currently impacted by this issue and we are working on a solution to allow us to meet these requests.”
The limit applies to three suspended property funds - the £4.4bn ($5.8bn, €5.2bn) M&G Property Portfolio Life fund, the £1.8bn Aviva Investors Property Trust Life fund and the £4bn Henderson UK Property Life fund.
The move by Standard Life to prevent its clients accessing their investment funds inside a life assurance wrapper is unlikely to affect other life company bonds as each firm has its own rules as to how clients can access their capital.