There are three classes of investments that Insurance Companies sell, which Insurance Advisors may procure for our clients:
EDITOR NOTE: This page is very much a first draft! Further details and related pages shall be written in the near future!!
Insurance Companies have a class of investments called Segregated Funds. They are called this because these funds are segregated from the monies the companies collect for covering Insurance policies.
Segregated Funds are investments with features like Mutual Funds, with some features that act like insurance.
Segregated Funds can be held within both Registered Accounts (RRSP, TFSA, etc) and non registered (Investment)
Upon maturity of the client contract or in the event of premature death, this protection ensures the recovery of 75% to 100% of the amounts invested if the market value of the funds is lower.
When the value of a fund increases, you have the possibility of “resetting” your investment so that its guarantee covers the gains generated with your investments. This allows you to lock in the new market value.
With a named beneficiary (as opposed to “estate”), the amount transferred from the Seg Fund doesn’t go into your estate, so probate fees will not apply.
The funds are paid rapidly to the beneficiaries in the event of death. This could help loved ones avoid having to personally take care of the deceased’s financial commitments (housing, mobile phone contract, etc.).
This can be an attractive advantage for you as an entrepreneurs or professionals who wants to limit your risk of loss during a difficult period or in the event of bankruptcy.
All tax calculations are made on the T3 slip issued to you which helps for your tax returns.
These accounts will look like a GIC.
An Annuity is similar to a pension. You purchase an annuity to provide a regular income.