One year on: more than £600 million of Child Trust Funds remain unclaimed 

It’s been a year (1 September 2020)  since the first Child Trust Funds matured, but Britain’s youngsters are sitting on a goldmine of unclaimed cash.

Since the first Child Trust Funds (CTF) matured last September, over half a million teens across the country have received letters telling them to claim the money, however only half of them have acted.

The average CTF is valued at more that £2,000, and with more than 300,000 of maturities not acted on, there is around £600 million set aside and waiting for instructions.  In the meantime, that money will continue to be invested in either a cash fund or in a stocks and shares account.

Child Trust Funds were introduced by the Government in 2005 as a tax-free savings account for children. Available to those born between 1 September 2002 and 2 January 2011, parents received a voucher of either £250 or £500 to set up an account in their child’s name.

As eligible teenagers become aware of their CTF, more and more are starting to claim their funds. Currently 46% of CTFs remain unclaimed, compared to 80% which sat unclaimed following the months after the first fund maturity.

According to the Association of Financial Mutuals (AFM), whose members hold one third of CTF’s, around 12% of funds have reached maturity.  As more young people start to gain access to this cash, the AFM explains that as well as messages on social media encouraging people to act, providers are improving their own messaging.  However, many young people remain reluctant to act, and this is a consequence of confusion, a lack of trust in financial providers, as well as failings in financial education.

It is up to the account holder of the CTF to decide what to do with the money. Their options are to withdraw the full amount, leave it in the fund, or reinvest the money into other savings products.

Martin Shaw, CEO of the Association of Financial Mutuals has some useful advice for Child Trust Fund owners looking to continue to invest their savings: Read the full article here

Coverage also in:

Daily Mirror

Daily Express

Business Fast

MSN News

Registration for the 2021 AFM Conference and AGM is now open.

After so many months of working from home, and as we adjust to living with Covid, the time is right to venture out and re-connect with the rest of the mutual insurance sector.

The 2021 AFM Conference and AGM will bring together key influencers from across the sector to explore how the sector is re-emerging and setting priorities for the future. Once again the conference offers the chance to network with friends old and new; debate current and future issues for the sector; and contribute to AFM’s planning.

We do hope that you and your colleagues will be able to join us. We are limiting the number of attendees at the conference this year, to enable us to respond to any changes in government guidance, so please register as soon as possible to ensure we cater for your requirements. For more information and to register your place as a delegate or exhibitor, visit our dedicated conference website

AFM confirmed as a Supporting Institution of the UN Environment Programme’s Principles for Sustainable Insurance

Later this year, COP26 in Glasgow will be a vital opportunity to re-focus attention on climate change.  It feels in the UK like we no longer need the prompt, though the Government needs to command astonishing changes to the economy to achieve our goals.

Insurance is- and will continue to- play a vital part in that change.  Making portfolios carbon neutral is a key aspect of that, but so too is redesigning products and services to reflect the changes to the way we are living.  Regulation has of course been the spur for action for many, but today we are seeing increasing calls from members to demonstrate a stronger commitment to doing our bit.  That is starting to feed through into disclosures in the report and accounts- albeit the momentum for more comprehensive reporting is growing quickly.

And it’s not just about climate change: ESG action can be seen in the way the sector supports employees, customers and local communities, and works in an inclusive way.  To reinforce the sector’s commitment to good environmental, social and governance practices, AFM has just been accepted as a supporting institution for the UN Environment Programme’s Principles for Sustainable Investment (PSI).

AFM’s CEO, Martin Shaw, comments:

“The mutual insurance sector in the UK has a long pedigree of working in the best interests of its customers- who are also its owners- and for the benefit of the communities it operates in.  By becoming a supporting institution for the UN Environment Programme’s Principles for Sustainable Insurance, the Association of Financial Mutuals is reinforcing that commitment.  We aim to help our members share from the wider experience of UN PSI to add to their growing knowledge of ESG factors, and to better meet the needs of society today.”

Analysis of the strategic landscape for mutual insurers and friendly societies

AFM is delighted to be working in partnership with Whitecap Consulting and key industry partners to conduct an analysis of the strategic landscape for financial mutual organisations in the UK, which will culminate in a report later this year, with the findings to be presented at the AFM annual conference in October.

The project is being conducted with support from industry sponsors including: Altus ConsultingCirencester Friendly Society, Fidelity InternationalHolloway FriendlyMillimanOddfellows (which includes Unity Mutual), PG MutualRussell Investments, and Royal London Asset Management.

The UK’s Financial Services landscape is a complex and dynamic marketplace, and this project seeks to analyse and understand the degree to which external market forces will materially impact organisations in the sector over the next 2-3 years. Specifically, the analysis focuses on how smaller mutual insurers, friendly societies and other financial mutuals can deliver relevance and differentiation, develop competitive and sustainable strategies, and achieve digital acceleration and technology enhancements to meet customer needs.

As part of the project, an online survey is being conducted to gather views from individuals and organisations that are active in the mutual financial sector or have an interest in it:


The outcomes of the project will help the AFM and its members to develop business strategies to respond to market forces, as well as supporting the AFM develop collective initiatives to support members.

Martin Shaw, CEO at the Association of Financial Mutuals:

Mutuals are customer-owned businesses and have made a virtue for decades of better understanding the needs of their customers. Whilst the financial services marketplace was already evolving prior to Covid, we’re starting to see significant shifts in customer needs and expectations now, and it is vital that our sector embraces those and explores how best to deliver outstanding products and services for decades to come. I’m delighted to be working with Whitecap, to help inform our sector on where we go to next.

Richard Coates, Managing Director of Whitecap Consulting:

The AFM represents a fascinating and diverse range of mutual organisations and friendly societies demonstrating a broad range of scale, products, distribution strategies and business models. We are delighted to be working with Martin and AFM members and supporters, analysing this sector and helping to develop practical commercial strategies.” 

Jim Leggate, Head of UK Institutional and Middle East, Russell Investments:

“We are delighted to support this initiative and contribute to the continued growth of a very important sector of the UK insurance industry. Since joining the AFM, we have been hugely impressed by the collaborative nature of the mutual sector as it seeks to meet the needs of its customers. We hope that members will find this research to be useful and insightful, and look forward to working alongside and supporting the sector for many years to come.”

The AFM is the trade body representing 43 mutual and not-for-profit insurers, friendly societies and other financial mutuals across the UK. Between them, mutual and not-for-profit insurers manage the savings, pensions, protection and healthcare needs of over 30 million people in the UK and Ireland, with annual premium income of £19.6 billion, and nearly 30,000 employees.

Whitecap has worked with numerous mutual and membership-based organisations over recent years, supporting the analysis, development and implementation of commercial strategies. In addition, Whitecap has completed a similar analysis of the Building Society sector and has also published market sector reports on topics including FinTech, Legal Tech, and Innovation ecosystems.

If you would like to take part in the research, please complete the online survey. If you are interested in supporting as a sponsorship partner, please contact

AFM Comments on the report of the APPG for Mutuals’ on its Inquiry into the proposed sale of LV=

“As a trade body supporting the mutual sector, the Association of Financial Mutuals is very grateful for the attention paid by the All-Party Parliamentary Group for Mutuals to the planned demutualisation of LV=.

The decision to demutualise is a one-time, irreversible one, and cannot be taken lightly.   The management of LV= has decided the business will be in a better position competitively under the protection of a private equity owner, Bain Capital.  However, it has yet to put the case to its members, who will ultimately decide on whether the deal goes ahead.
Over the last 30 years, demutualisations have seldom resulted in a happy outcome: customers generally get a worse deal as their interests become secondary to those of shareholders; management’s expectations of more capital, as well as greater independence in which to spend it, have tended to result more often in failed business plans and an early takeover.
The mutual sector continues to serve tens of millions of UK customers, and is as relevant and vital today as it has always been.  As consumers demand that financial services businesses manage their money more responsibly, and pay greater attention to the needs of society, the attraction of customer ownership is becoming ever more apparent.
We agree entirely with the APPG inquiry recommendations, that there is greater scrutiny of the proposed sale by parliament and by regulators, and that more attention is given to updating legislation, to enable the mutual sector to compete on equal terms.”

In a recent article for FT Adviser, AFM’s CEO comments on the demise of a stalwart of member-ownership. Read more

Research from Association of Financial Mutuals (AFM) shows paid claims volume increased 38% compared to last year. Read more here

The latest news from Association of Financial Mutuals

In an article published in the i on 11 January 2021, AFM CEO provides expert advice on businesses owned by customers: Read here

Sign-up for Mutually Yours Newsletter