Unity Mutual launches Lifetime ISA

The Lifetime ISA also offers free life cover of up to £5,000 if customers contribute a minimum of £1,000 per year over the next five tax years.

Savers wishing to open a Unity Mutual Lifetime ISA can do so with an initial investment of £250, or by setting up a direct debit of £25 a month.

Children turning 18 who hold Child Trust Funds and Junior ISAs can also transfer up to £4,000 into their Lifetime ISA and still receive the government bonus.

Insurance director at Unity Mutual, Steve Code, said: “As we have been a Child Trust Fund and Junior ISA provider for many years we know from speaking to advisers that many of their clients worry about children and grandchildren and how they will buy their first home in the current market. Our Lifetime ISA can offer young people – and the families supporting them – a way to do that.

“Our introductory 1.25% interest rate, combined with the government bonuses and full capital protection means savers do not have to risk everything on a stock market at the end of one of the longest bull markets in history.

“Lifetime ISAs are a valuable tool for the government to help tackle the problem of young people struggling to get onto the property ladder. They reward committed saving but also have a degree of flexibility too. We’re glad that the debate over their future has been put to rest – we think the Lifetime ISA opens up the opportunity for many young people to save for and buy their first home and we’re glad to be able to do our bit to support that.”