Safe investment with insurances: separate managementLouise Simons September 24, 2018 0 COMMENTS
An investment can be considered safe when in any case the invested money is returned in its entirety on a pre-established date. An investment is uncertain when there is a real danger of the debtor’s bankruptcy or when the investor participates in the debtor’s financial operations and also assumes the risks, as in the case of shares or funds.
The separate management of life insurance is one of the safest insurance products on the market . These are in fact funds created specifically by insurance companies, distinct from those of the company. In the event that the latter fails, the capital set aside with the policy would still be guaranteed.
The companies are also required, every three months, to publish on the national newspapers the composition of the separate management , which is usually oriented towards prudent investments, BTP, Cct, Ctz and BOT, while the equity exposure is rather limited.
In the second half of the 1990s, these policies were considered as outdated by the new generation of life products (the units and index linked) more dynamic as they were more closely linked to the performance of the financial markets. But the 2008 crisis, which caused serious losses in the financial statements of unit-linked companies and even questioned the guarantee of repayment of capital on maturity in the case of index-linked companies (those with underlying assets linked to Lehman Brothers or Icelandic banks), the strengths of traditional life contracts are rehabilitated.
From 1981 to 2009, segregated accounts only recorded positive net performances. Moreover, the results are always consolidated: the provisioned capital is reevaluated every year and can never go down. Every year at the anniversary of the subscription is calculated the yield obtained that is added to the initial capital. On the next occurrence, the yield will be calculated on the total (initial capital + return of the first year) and so on for the entire duration of the contract.
When choosing the policies on the market, it is necessary to carefully evaluate: – loading and management costs
, if they are high, the actual yield obtained can also be much lower than the yield obtained from the management; we take the Ri.Alto separate management, to which the Sicuramente and Pianopiano policies are linked; in 2009, the certified management return was 4.27% and the policyholders received a yield of 3.27%; there are no costs on premiums paid or any other type of cost, while some policies provide for additional costs that weigh on the amounts paid even before they are invested
– any clauses related to early disinvestment , which often penalize the investor, and those related the interruption of paymentsthat, especially in the first period, can make all the accumulated capital lose; for example with policies Surely and PianoPiano , 12 months after signing can disinvest in any time getting to the revalued capital; in the case of the Pianopiano, in the event of interruption of payments, the contract remains in force and continues to be revalued; on the other hand, there are policies that provide for the loss of part or all of the capital in the event of disinvestment before the expiry of the policy, and the same can occur in the case of the interruption of periodic payments