According to the results of the first half of 2016, life insurance premiums showed a significant increase. The main driver of growth was the bancassurance sector, but, unlike in previous years, not due to insurance imputed when obtaining a loan, but due to investment life insurance (ILI). Many banks offer such an insurance product as an alternative to deposits, since in a positive scenario it can provide a significantly higher income. The product is difficult to understand, because for its understanding it is necessary not only to know the basics of insurance, but also to have an idea about the investment field. Let's try to figure out what investment life insurance is and what you should pay attention to when purchasing this service.

What is ISJ?

Investment life insurance is a product that combines customer life insurance and a financial instrument that allows you to receive income by investing part of the deposited funds in various financial assets offered by the insurer (bonds or shares of various companies representing various sectors of the economy, precious metals, etc.). P.).

The main insurance risks under the ILI contract are:

Survival until the end of the insurance contract,

Death for any reason.

The sum insured for the risks of survival and death for any reason is 100% of the paid insurance premium, increased by the amount of investment income. The terms of insurance can be from three years. Payment of the insurance premium can be made either at a time or during the insurance period in equal installments (monthly, annually). Additionally, the policy may include other insurance risks (death as a result of an accident, death as a result of an accident, etc.), the sums insured for which are set separately and, as a rule, exceed the main sum insured.

The insurance premium received from the client is divided into the guaranteed part and the investment part. The insurance company invests the guaranteed part in conservative fixed income financial instruments. The income generated helps ensure the guaranteed payout amount. The investment part is invested in highly profitable, but at the same time high-risk financial instruments, due to which a significant investment income is expected.

ILI is not a means of obtaining guaranteed profits. If the chosen investment strategy “did not work”, the client, after the expiration of the insurance period, receives only the amount of the so-called guaranteed income, which, as a rule, does not exceed 100% of the insurance payments made. The classic insurance risk component also cannot be called tangible, since in the event of an insured event for standard risks (for example: “death for any reason”), the insurance premium paid is reimbursed with investment income calculated on the date of the insured event. Only if there are additional risks (for example: "death as a result of an accident"), you can receive an additional amount, as a rule, also not exceeding 100% of the contribution.

Advantages and disadvantages

The positive qualities of investment life insurance include the presence of tax benefits: receiving a tax deduction in the amount of 13% of the paid insurance premium and the absence of obligations to pay taxes on insurance payments. The maximum amount of the insurance premium from which you can receive a tax deduction is limited and amounts to 120 thousand rubles, and it is applied only for contracts for a period of five years, but upon receipt of income exceeding the refinancing rate, the excess is subject to income tax. Thus, the maximum reimbursement can be 15,600 rubles.

Compared to bank deposits, ILI has positive legal features. From the moment of payment of the insurance premium until the receipt of the insurance payment or the return of the premium upon termination of the contract, the funds belong to the insurer and are not the property of the debtor held by third parties. Funds cannot be confiscated, they cannot be seized, they cannot be recovered in court, they are not subject to division between spouses in a divorce and do not need to be declared.

The contract can be concluded in favor of any person (beneficiary), and if the risk of "death" is realized, it is this person, and not the heirs, who will receive the payment. In this case, there is no need to wait for the entry into the inheritance rights.

The presence of a guaranteed payout amount in the contract is also an additional advantage, which is important when investing in risky instruments.

One of the main disadvantages of investment life insurance is the lack of the possibility of early termination of the contract with the receipt of all paid insurance premiums. Since the minimum term of such contracts is three years, and in most cases they are concluded for five years, this can be a significant problem. But in any case, it is not as sharp as in endowment insurance contracts. When terminating the insurance contract, the client can only receive the redemption amount. As a rule, when paying the insurance premium at a time, the redemption amount is 75-90% of the amount of the premium. But depending on the terms of the contract, the term of insurance, the procedure for paying insurance premiums and the date of termination of the contract, the amount of the redemption amount may be significantly lower or equal to zero.

Investment life insurance is an insurance contract that has a certain list of exceptions, according to which not every case of death is recognized as insurance. At a minimum, these are standard exceptions from the Civil Code of the Russian Federation (cases that occurred as a result of intentional actions of the insured, military operations, civil unrest, and exposure to radiation), but the list of exceptions can be greatly expanded by the contract.

It is imperative that you familiarize yourself with the insurance rules in terms of payment in case of events that fall under this list of exceptions. As a rule, the redemption amount is paid to the heirs of the insured, but there are products that provide for other conditions.

A significant drawback is the lack of a guarantee fund that could provide payment to the client in cases of revocation of the license or bankruptcy of the insurance company. If, when revoking the license, the insurer did not transfer the portfolio or terminate the contracts with the return of the premium (as the law requires), you can receive compensation only by joining the register of creditors.

Of course, the most obvious disadvantage of this product is the lack of guaranteed income. If the strategy develops negatively, at the end of the contract, the client will receive only the payment guaranteed by this contract.

What to look out for

If you are talking about the placement of funds with a bank representative, first of all you need to understand what product you are offered: recently, there have been frequent reviews of customers who have been offered an ILI agreement as a complete analogue of a deposit, but with a higher profitability. If you understand the difference and are potentially ready to consider this type of investment, then, in addition to studying the size of the redemption amounts and the list of exceptions, the important point is the choice of strategy and the possibility of changing it during the period of the contract. It is the chosen strategy that should provide income in the future.

The strategies proposed by the insurer are often not transparent. The insured cannot independently track the dynamics of the movement of a particular fund on the market: as a result, he can only believe in the indicators disclosed by the insurer. There are also objective reasons for such a position: a successful strategy can be copied by competitors. The insurer, in fact, is left with two options. The first is to try to find products with strategies that are tied to the cost of certain commodities (gold, oil of a certain brand) or to funds whose dynamics can be tracked in public sources. The second option is to trust the professionals on the insurer's staff working on strategies and treat this choice as one of the risks of investing.

One of the key indicators when choosing a strategy is the so-called participation rate. The coefficient shows what share in the growth of the chosen investment strategy the insured can claim. The ratio can vary greatly. With a coefficient equal to 100%, the return of the insured is equal to the return shown by the selected fund. An important difference between the products of different companies is that the percentage of profitability multiplied by the participation rate can be applied both to the entire amount of the contribution, and to the part aimed at investing. In the first case, the breakdown of the contribution into guaranteed and risky components for the insured is simply informative, and in the second case, it is decisive for calculating the yield under the contract.

Also, insurance companies offer their clients the option of changing their strategy during the period of the contract or fixing earned income. As a rule, the number of these operations is limited (for example, once a year). Changing the strategy allows you to change the investment fund if the chosen strategy does not bring the expected result, and the other one has better dynamics. When changing the strategy, the participation rate is set on the date of the change. Fixing investment income is advisable to apply when the current investment income of the selected fund is high enough and you predict a decrease in the level of profitability.

It is better to give preference to the insurance programs of those insurers who have the opportunity to create a personal account on the site. Firstly, it will allow you to control the dynamics of the fund and respond to changes in a timely manner. Secondly, it will provide the possibility of making changes to the contract (increasing the amount, changing the strategy) without contacting the office of the insurer. This became possible due to the adoption in June 2016 of a law providing for the possibility of drawing up a life insurance contract in electronic form. When choosing an investment method, it is important to understand that ILI is not equivalent to a deposit. This is an independent financial instrument that has its positive and negative sides. The main thing is to follow the basic rule - do not invest all your funds in one investment object.

More than once I have witnessed how bank employees are actively selling accumulative and investment insurance policies to people with the words that "it's like a deposit, only more profitable." At the same time, it is silent about the features and disadvantages of this financial product. Sometimes such stories end with unpleasant surprises. Here is one of the customer reviews:

When buying a health or life insurance policy, the insurance company must request information about the client's health status. However, when selling UA and ILI policies (accumulative and investment life insurance, respectively) through intermediary banks, employees are far from always interested in this issue, and people do not know that they should report this.

The policy will be considered invalid for people who have a disability, certain medical conditions, or who are undergoing outpatient treatment. Only then will an attentive person be able to find out about this from the details of the contract. Another sad customer review:

What is endowment and investment life insurance

HOA and ILI are hybrid financial products that include insurance and investment. They are provided by insurance companies, but the main sales go through partner banks.

Cumulative insurance is focused on the formation of savings together with insurance protection, and investment insurance is aimed at the growth of investments and also insurance protection. The policy is issued for a long period, usually from 3 to 7 years. In the case of HOA, you undertake to make regular contributions, and in the HOI, the entire amount is usually paid when the policy is opened.

During the term, you cannot withdraw your money, except by paying a large fine (up to 100% of all your deposits). At the end of the term, you will receive your money back, plus possibly additional investment income. The return of your funds is guaranteed, and additional income is only expected.

In the event of an insured event, as a rule, you receive an insurance indemnity in the amount of the deposited funds.

The internal structure of the ILI resembles a structural product. There is a low-risk underlying investment, such as safe bonds or bank deposits, that provides a money-back guarantee. And there is an investment part, usually in the form of financial derivatives, which either "burn out" or make a profit over the term of the contract. The specific details of what is included in your insurance are not disclosed by insurance companies, although sometimes they generally offer different investment strategies to choose from.

What is the real return

Sellers lure customers with promises of high returns, often quoting 20-25% per annum. But we must not forget that this is only an expected, but not guaranteed return, and many people who are used to dealing with bank deposits do not understand this.

Insurers guarantee only the return of the amount paid (excluding inflation), and sometimes a small 2-3% yield on endowment insurance. How they calculate the investment yield, you can not check in any way, and are forced to believe what they themselves will show you.

At an industry event in October 2017, the president of the Life Insurers Association said: “The return can now reach up to 7-8% per annum.” Don't miss the words "may" and "before".

How much are you losing

In September 2017, the CEO of one of the major insurers spoke about the results of investments in ILI: “For a significant proportion of five-year contracts that are now ending, the profitability will be close to zero - due to objective reasons. The underlying assets, in which the funds of insurers were invested under contracts until 2014, lost a lot of value due to force majeure and the economic crisis.”

It is difficult to imagine what basic (reliable) assets the insurance company chose to get such results. Let's compare their results with the index of Russian government bonds, which is formed by the Moscow Exchange:

Over the mentioned 5 years, it has grown by 53%. The MICEX stock index, taking into account dividends, grew by 76% over the same period.

I can open a secret and tell you why such a profitability is obtained. Here is a picture from a seminar for financial advisors who are trained to sell life insurance policies:

Comments, as they say, are unnecessary. And do not forget that these are only commissions to agents, and the insurance company certainly did not offend itself. All this money is paid out of your pocket.

Other risks of life insurance and life insurance

Unlike bank deposits, policies are not insured by the state.

Many subtleties can be found in the contract and insurance payments. In some cases, they will refuse to pay you (for example, a person drank a little and was hit by a car - “it’s his own fault”), some serious illnesses will not be recognized as fatal, and you will not receive anything. You are obliged to notify the insurer of various changes in your life (eg place of residence, work, occupation, hobbies). And the insurance company in some cases can unilaterally increase the amount of your contributions. The nuances may be different, study the contract.

Advantages of NSZH and ILI

Funds invested under the insurance program cannot be confiscated, seized, recovered in court, and so on. They are not subject to division in a divorce. In the event of the death of the insured, they are not inherited according to the general procedure, but are paid to the person indicated in the policy without waiting 6 months.

conclusions

As a result, we get an opaque product, the financial results of which suffer from huge commissions, and the insurance amount is limited by the funds you contribute. A sort of miracle Yudo, which brings good profits to the insurance company and sales agents.

The fact that effective economic development is the result of active investment activity is true not only for countries and states with a developed market system, but also for individual enterprises and individuals. The main purpose of investments is to make a profit from entrepreneurial activity as a result of the placement of free assets in one form or another. The amount of income that an investor can ultimately receive depends largely on the choice of the type of activity. But this choice also determines the degree of risk of loss of invested funds, which will increase taking into account the increase in the size of the expected income.

Finding the golden mean, calculating the maximum possible profit under conditions of minimized risks means providing yourself with a guaranteed stable income for the entire investment period. This is the aim of many clients who are trying to find this middle ground by choosing a suitable investment object. The fact that demand creates supply has long been known, therefore, in the context of economic development in the Russian Federation, various programs, projects or products are being developed that meet the necessary requirements and can become an effective tool to achieve this goal.

A new direction in investment programs

For the Russian market of services, the idea of ​​combining high-yield deposit opportunities in combination with insurance protection is new, despite many years of successful practice abroad. The first investment life insurance programs developed for the Russian market began to appear on it in 2010. And almost immediately won a certain share of it in the field of insurance services. The need for product development has created a vacuum in offering investment programs to individuals. Since independent activity on the exchange requires certain knowledge and skills that not every individual can boast of, as well as significant time costs, this market segment remained empty for a long time.

Investment life insurance is a new product that takes into account the lack of time and skills in stock trading among ordinary citizens, but allows them to learn the basics and receive potentially high returns on deposits in a growing market, as well as eliminate the possibility of loss in case of market failure. The product allows you to make independent decisions in choosing an investment object, offering a choice of several and additionally providing insurance coverage for the entire investment period.

The role of banks in investment life insurance

The ILI product, which appeared on the Russian market since 2010, began to actively conquer the banking sector. According to the data for 2016, there is a significant increase in the collection of funds received from life protection agreements, but not in the field of lending as a result of a mandatory condition of the loan agreement, but as a result of offering a product whose purpose is life insurance with the payment of additional investment income.

The ILI product began to be offered by banks as a replacement for the usual deposits, as it allows the depositor to receive a higher income with a successful choice of fund or strategy. Under the ILI product contract, several strategies are proposed for consideration by the insured. He has the right to independently monitor the dynamics of the market to make a decision on the choice of investment object or trust experienced professionals and let them make such a choice.

Analyst forecasts

The fact that investment life insurance today annually increases the number of premiums is explained by the fact that in 2015, as a result of previously concluded contracts, the highest incomes were received. RAEX analysts predicted such growth rates and according to forecasts. They will continue until 2018. But some experts argue that the growth in volumes in this area will not slow down, but will continue in the next periods. By offering investment life insurance, the bank seeks to show regular depositors the possibility of obtaining a higher return on investment than income from dividend deposits. At the same time, he explains the beneficial obligation to maintain the initial deposit, which cannot be guaranteed by independent activity in the conditions of exchange trading.

What does the ILI product include?

Investment life insurance, or ILI for short, is a product that originates from accumulative insurance, but additionally includes a financial instrument that allows you to receive additional income at the end of the term. Therefore, it includes the payment of a premium for mandatory insurance risks, which can be either a lump sum or divided into equal payments throughout the entire insurance period and the subsequent division of the invested amount into guarantee and risk funds.

This is done in order to be able to return the invested amount to the investor at the expense of a guaranteed fund, which is invested in reliable government bonds. Small income on bonds in the amount of the fund itself by the end of the insurance period will be equal to the initial contribution. A risk fund is a part of the deposit that is actively invested in high-yield and high-risk stocks or deposits. Investment life insurance, the investment income that it allows you to get, can significantly exceed the initial investment amount with a successful choice of objects for investment.

Insurance share of the ILI product:

  • creates the necessary life insurance protection for the depositor;
  • guarantees the execution of the contract in favor of the beneficiaries upon the occurrence of insured events;
  • provides tax incentives.

By signing the contract, the depositor can be sure that he will receive 100% of the amount invested by him, subject to the terms and conditions stipulated by investment life insurance. Profitability from risky activities is not guaranteed. At the time of completion of the contract for the product, it can be either zero or very high.

Conditions for concluding an agreement under the ILI program

Legal entities and individuals over the age of 18 can participate in the ILI program, while only an individual between the ages of 18 and 70 can be insured. To conclude a contract, the policyholder needs to determine the insurance period, possible additional risks, the number of beneficiaries in case an insured event occurs, and also choose the amount for investment and funds or a strategy for operations with risky assets.

The contract must fix the terms, the amount of the contribution and the frequency of payment, the main insurance risks and the obligations of the insurance company on them, as well as the details of the parties for financial transfers. After all the individual features and important points under the contract are spelled out, it is signed by the interested parties and certified with seals. The contract is drawn up in triplicate, but the client-investor is issued an investment life insurance policy, which will be the basis for payment in the event of an insured event.

Distinctive advantages of ILI from the usual investments in exchange trading

The fact that a new investment product has an advantage over mutual funds is true in terms of guarantees that the invested amount will be saved. An insurance policy that allows you to guarantee the return of the initial amount and, at the same time, it is possible to earn additional income on high-risk operations (if you wish, you can do them yourself or give the right to this activity to professionals), it is very convenient for beginners who are unfamiliar with the basics of investing, but are ready to develop their skills and knowledge in this area.

The ILI agreement allows you to study a rather complex investment instrument in practice and at the same time not lose the invested amounts. The product makes it possible to change the selected objects for investments throughout the duration of the contract. In addition to this, investment life insurance includes tax benefits:

  • They apply to all insurance payments.
  • Investment income is taxed only on amounts exceeding the refinancing rate at the time of receipt of payment under the investment agreement.
  • There is a tax deduction that allows you to return part of the funds from taxes on income (13%) that exceeds the refinancing rate.

The insurance contract is protected from legal claims that may be brought against the policyholder during the term of the contract. Protection has legal force, and is explained by the absence of any value of the policy until the end of the fixed terms of the contract. This means that under any adverse circumstances, such as foreclosure, seizure of property or divorce proceedings, the funds contributed under the agreement will not be confiscated. Securities purchased through a policy are not formally the property of the insured or investor, and no claims can be made against them either.

What is impossible under the terms of the ILI agreement

The ILI program agreement does not provide for early termination with 100% payment of the contributions. If for any reason it becomes necessary to suspend the operation of the contract before the established deadlines, then it will not be possible to return the amount paid. The maximum that you can count on is the redemption amount, the amount of which is set in advance and largely depends on the duration of the contract. Long terms under the contract often provide the highest possible return. For example, investment life insurance "Rosgosstrakh" provides for payments from 75% to 90% of the premiums paid in case of early termination.

What you need to pay attention to when concluding an ILI contract

Investment life insurance does not guarantee income from the risky activities of an active fund. During the term of the contract, the market can not only rise, but also fall, and income will largely depend on the chosen strategy. If during the term of the contract the license of the insurance company is revoked or the organization is declared bankrupt, then settlements with this company may be in question. When concluding a contract, be sure to check the list of the main risks included in the contract, since not all cases are recognized as insurance.

Choosing a company to draw up an agreement on the ILI product

When choosing a company to conclude a long-term product, you must be sure of its stability. In the conditions of the Russian market of insurance services, such companies include:

  • "Rosgosstrakh";
  • "Renaissance Life";
  • Alpha Insurance.

In addition to insurance companies, banks can also offer an investment insurance product. Such interest of financial institutions is explained by the financial side of the contract, which has investment life insurance. Sberbank in this case acts as a leading stable bank offering this product. The Sberbank program provides for investment insurance with an initial capital of 100,000 rubles or more and an investment period of 5 years or more. Under the terms, the client can change the asset, make additional contributions, fix profits or withdraw additional income without terminating investment life insurance. Sberbank receives customer reviews regularly. Those who managed to get the first profit under contracts concluded at the very beginning of the product's appearance on the Russian market note the convenience of the service offered.

Interesting proposals for insurance programs can be offered by Russian Standard Bank, in whose portfolio you can find an offer for children with small contributions under the contract, which can significantly increase the initial amount of payments.

Investment life insurance: reviews

The fact that the product appeared on the market relatively recently explains the numerous statements that characterize it both positively and negatively. The dual reputation of the product is due to the stratum of society for which it was developed. An unfamiliar area of ​​activity for an ordinary person, related to stock markets and exchange trading, which is present in the investment part of an insurance contract, causes mistrust and fear among the population.

It should be noted that some individuals who managed to conclude contracts at the very beginning of the appearance of the product on the Russian market and by now have managed to receive significant income, speak of the product as an indispensable tool. Together with them you can hear a lot of dissatisfied statements. Basically, they come from people who, for some reason, were offered an investment product as a complete alternative to a deposit, but with a higher return. At the same time, it was not explained that the chosen strategy largely affects the size of such a high yield, besides, the insurance part of the contract was silent, which, in addition to protection, provides significant tax benefits. Despite the incidents caused by the novelty of the program, and taking into account its further understanding among the masses, we hope that reviews of such a product as investment life insurance will be more positive in the future.

Today, many are thinking about how to save and increase their savings. The usual bank deposit barely covers inflation. Independent investment requires certain knowledge, while there is a high risk of losing all the money altogether. Having caught the trend, insurers have developed a new product - investment life insurance (ILI), which is, in fact, an investment instrument in an insurance shell. Like any financial and insurance product, it has its advantages, but it is not without its drawbacks.

We will talk about what ILI is, how it works, and in what cases such an insurance program will be beneficial for a Russian, in this review.

What is investment life insurance?

In the previously considered (NSZh) the main goal of the insured is to accumulate a certain amount over a certain number of years and provide financial protection for the family in case of loss of a breadwinner. The purpose of investment insurance is to increase the funds (already accumulated by the client) by analogy with a bank deposit, while providing financial protection for the insured's relatives in case of unforeseen circumstances (the death of the insured).

Only here there is a small nuance - ILI and a classic deposit are completely different things, because unlike a deposit where you are guaranteed income in the form of accrual of interest specified in the deposit agreement, ILI does not guarantee you any income.

In general, any actions related to “investment” involve risk, and the more income you are promised, the greater the risk of not receiving it (and in some cases even losing the invested funds). Therefore, as a definition of ILI, I would like to take a quote from the website of the Central Bank of the Russian Federation, which, by the way, is the regulator of the insurance industry of the Russian Federation.

Investment life insurance is an investment vehicle with the potential to earn a potentially high return if the market goes up and a guarantee of a return on the deposit if the market goes down. A feature of the program is immediate compensation in the event of the death of the insured person.

That is, you make an insurance premium, and you can expect to receive income significantly higher than the market average rate on deposits due to the fact that the insurer will invest (invest) your funds in certain assets (funds, stocks, bonds, etc.). ). But if the investment brings the insurer not income, but losses, then you will not go into the red - you are guaranteed to get back your money invested as a contribution. Well, an additional “bonus” to all this is life insurance for various risks.

How is the ILI policy arranged?

Since investment life insurance is a financial and insurance product, it makes sense to consider its financial and insurance components separately.

The financial component of the policy

The client's contribution is divided by the company into two unequal parts: the Guarantee Fund (GF) and the Investment Fund (IF).

The guarantee fund makes up the majority and is used by the insurer to invest in fixed income instruments (for example, deposits, federal loan bonds). It is at the expense of the GF that the company can guarantee the client a 100% return on investment in any situation on the market. GF is also called an insurance reserve.

The investment fund is used to invest in highly profitable, but also high-risk instruments (stocks or bonds of Russian and foreign companies, futures, options). If the market grows, it can give a good income, calculated in tens of percent per annum! As insurers like to point out on their official websites, the program's profitability is unlimited, which makes some customers swallow their saliva, wondering what profits they could get.

The fact is that companies offer a choice to the client (hereinafter the quote of Sberbank Life Insurance LLC in the description of the SmartPolis product) - “proven risk fund investment strategies that tend to grow in the long term” (we will talk about strategies in more detail a little lower). And for each strategy, the profitability received for a certain period in the past is sometimes indicated. This is usually a nice figure, but pay attention to the fact that income received in the past does not guarantee its receipt in the future - the market is unpredictable and a sharp and prolonged fall can follow an increase.

The ratio of GF and IF depends on the term of the contract. The longer it is, the more part is involved in investments, which means there is a possibility of receiving a higher income.

In any case, you (or your relatives) will receive back an amount equal to at least your contribution, or an amount increased by investment income.

Insurance component of the policy

ILI is based on the classic risks of life insurance - the survival of the insured until the expiration of the contract and death for any reason. This is basic or mixed insurance (“naked” - in professional slang for insurers).

If the insured successfully survives until the end of the term indicated in the contract, he receives 100% of the invested funds plus income from investments - this is how the “survival” risk works. The same thing happens if he dies before the contract ends, only the beneficiary (or several beneficiaries) appointed by him receives the money - this is already the risk of "death of the insured for any reason."

The insurance component provides financial protection to the family (relatives) of the insured against his sudden death. When connecting additional options, it also provides protection for the insured against temporary disability.

An example of calculating an investment life insurance program

Below you can see an example of calculating ILI (insurance product Capital from the company PPF Life Insurance LLC), taken from an open source (https://avdenin.ru/invest/investicionnoe-strakhovanie-zhizni.html).

As part of this calculation, the client insured under the main program (mixed insurance) and under the additional one, where additional risks are taken into account (see below). Guaranteed payouts are listed on the first page, and expected payouts (with luck and income received as a result of investments with an expected return of 13.7%) - you can see on the second page. There is also a guarantee and the expected amount of the redemption amount.

This example will help us a lot in the subsequent analysis of the topic.

How does ILI work with a risk component?

And what about insurance? - you ask. Yes, many companies in a purely investment policy have practically no risk, except for the basic one. But nothing prevents you from buying in addition insurance coverage against accidents (HC). Typically, companies insure against death and total permanent disability as a result of accidents. The risk component is calculated and paid additionally, and subsequently is not returned.

Some nuances of ILI with a risky part:

  • when connecting additional options, the contract works, among other things, as a classic risk insurance program (a small insurance premium and a significant amount of insurance payment in the event of an accident);
  • the validity period of insurance protection against NS is equal to the validity period of the ILI contract;
  • a beneficiary is appointed in the event of the death of the insured person (not necessarily from among the legal heirs);
  • the beneficiary in the event of disability is the insured person himself.

For a number of large insurers (VSK-Liniya Zhizni, Ingosstrakh Zhizn, PPF Insurance and others), the risk part is included in the program by default, no additional contributions are required.

Let's look at the above example: the policy includes accident insurance with sums insured of 1,000,000 rubles for each risk (death from NS and disability as a result of NS).

In case of death from NA in the 5th year of the contract, the calculation will be as follows:

  • 1,000,000 rubles - invested amount (contribution);
  • 1,000,000 rubles - liability limit for the risk of death from accident;
  • 646,072 rubles - available income from investments (see the column "Expected size of the investment part" opposite 5 years).

Payment to the beneficiary: 1,000,000 + 1,000,000 + 646,072 = 2,646,072 rubles. The agreement is terminated.

If the insured is assigned a disability group as a result of an accident (1 or 2 - depending on the conditions of insurance), he receives only the sum insured at risk - 1,000,000 rubles. The money earned on investments is not paid to him, and the contract continues to be valid until its expiration, when the guaranteed + investment part is paid to the client under the Survival risk.

The inclusion of additional risks in the policy is equally good both for the insurer (the opportunity to earn extra money), and for the insured (all risks are taken into account in one product) and the beneficiary under the contract (increased amount of payment for the risk of death as a result of accident).

Investment strategies: Where to invest money?

Where is your money being invested?

Now let's take a closer look at the intricacies of investing through insurance. Insurers offer a wide range of financial instruments, calling them strategies. The most popular and effective are investments in the following assets (or stock indices):

  • US stocks (SP500 index)
  • shares of Russian companies (MICEX index);
  • high technology (NASDAQ 100);
  • European consumption (STOXX 600 Personal & Household);
  • gold (following the value of an ounce).

The insured can choose the sector of the economy where his money will be invested. He may be offered shares (or bonds) of companies in the oil and gas, financial, consumer, telecommunications, electric power or metallurgy sectors. For example, investments in pharmaceuticals and the consumer sector in Europe and the United States are considered promising.

Typically, companies choose the best financial instruments by default on a risk-return basis. The insurer is no less interested in the growth of investment income than the client.

Here it is appropriate to talk about such a concept as the participation rate. It shows what part of the profit the insurer shares with the client. This may be 50 - 80% of the income received, or maybe 150%. Therefore, when concluding a contract, be sure to be interested in this parameter.

What is a participation rate?

One of the most important parameters to pay attention to is participation rate(KU). The participation ratio shows what part of the return on the growth of an asset (stocks, bonds, etc.) the client can receive at the end of the investment period.

The client's income can be represented as the following formula:

Income \u003d KU * Growth of the asset;

KU is usually given as a percentage, and its value depends on the chosen investment strategy. If KU = 100%, then with the growth of the asset used as part of the investment strategy, the client will receive all 100% of the return on growth. If KU = 150%, then the client already receives 150% of the income received from the growth of the asset.

The value of the participation ratio in itself means little - it must be considered in conjunction with the investment strategy (ie, with the underlying asset in which the client's funds were invested).

Usually, the higher the CG, the lower the profit potential of the asset, and vice versa, the value of CG is lower for assets with high profit potential. So the company strives to equalize the expected return on investment strategies. Therefore, you should not "grab" a high CG - pay increased attention to the asset within the framework of your chosen strategy. If it is promising (at least it has shown good returns in the past), then it makes sense to choose it, even if with a small CG.

KU is calculated at the time of connection to a certain strategy and, depending on the state of the market, it can take different values ​​at different times.

Trust but check!

The client must clearly understand that the return on investment is never guaranteed. If there is an increase in demand for stocks or gold, you make a profit. If assets become cheaper, your income is reduced or none at all. To track investments, the client is offered to open a personal account on the insurer's website, where the client can track financial performance under the contract.

Initially, when investing in investment insurance, you trust professional traders who are on the staff of the insurance company. You will not have complete transparency in the use of strategies, and you will have to come to terms with this. However, the information that you receive through your personal account allows you to track the effectiveness of investments in terms of the final result for a certain period.

If it is lower than expected, the investment strategy can be changed (fund change). The possibility and frequency of its change should be indicated in the contract.

You can also fix additional investment income (by increasing the size of the guarantee fund by the amount of the current investment income), receive a payment of the received income or make an additional contribution.

Specify whether it is possible to distribute the amount intended for investment among several strategies. This will allow you to diversify your portfolio.

What else to look for when applying for a policy?

1. An ILI contract can be opened for a period of 3 years (in some companies from 5 years) to 10 years.

2. The contribution is paid in a single payment at the time of the conclusion of the contract or in installments (if possible).

3. The lower threshold for entering the ILI, as a rule, is not less than 30 - 50 thousand rubles.

4. The age of the insured is from 18 years to 80 years at the time of conclusion of the insurance contract.

5. The contract comes into effect from the moment of making the first (or only) installment.

6. If the conditions of the insurer allow, then the insurance program can be linked to foreign currency, while payment of the contribution (insurance premium) and insurance payment is determined at the rate of the Central Bank of the Russian Federation.

Pitfalls of early termination of the contract

Any contract may be terminated early. But! It is worth investing in ILI only if you are sure that you will not need them in the coming years. This is due to the losses that you will incur in case of early termination. In insurance, there is a concept - the redemption amount. It applies to any investment or savings policy. Terminating the contract in a year or two, you will receive at best 50% of what you have invested. The closer to the end of the term the termination occurs, the greater the amount you receive.

As an appendix to the contract, there should be a table reflecting the estimated expectations from investments and the amount of the redemption amount. According to it, the insured sees how much money he is expected to receive in case of early termination of the contract. Calculation example for termination in the fifth year of a ten-year contract (see above):

  • the amount paid is 1,000,000 rubles;
  • redemption - 690,000 rubles;
  • income (expected) - 646,072 rubles.

Expected payout: 690,000 + 646,072 = 1,336,072 rubles.

Early termination of the ILI contract is extremely unprofitable- count on investing in it before the last day of its validity!

Where to buy an ILI policy?

Insurance companies work closely with banks. The latter are extremely interested in promoting ILI. As agents of insurers, they receive remuneration to compensate for the decline in demand for some of their products. And then, the money received under the agreements concluded with the help of the bank remains in it.

Numerous reviews of those who purchased insurance at the bank indicate that managers literally impose ILI without revealing many details and nuances of the product.

This applies to both the terms of the contract and the choice of investment strategy. Since a lot of money is invested in insurance, you should not succumb to persuasion and immediately conclude an agreement. Take a time out, get to know such a complex product on the website of insurance companies - after all, it is to her, and not to the bank, that you entrust your money. And don't be afraid to ask questions if you don't understand something.

Experts recommend concluding a contract at the office of the insurer, where the client can be given competent advice and help to choose the product he needs. Bank employees often do not understand their products, but, nevertheless, they impose such complex structural products, operating with stereotyped phrases in an industry that is not their core business.

What is important when concluding a contract?

Before signing a contract and investing a lot of money, you need to study the section “Exclusions from insurance coverage”. For all companies, death that occurred as a result of cases listed in the Civil Code of the Russian Federation (military operations, popular unrest, etc.) is not considered an insured event.

Additionally, each company minimizes its risks by supplementing the list of exclusions with death due to serious illnesses that the insured had at the time of conclusion of the contract. In this case, if the insured dies before the expiration of the insurance, the beneficiary receives only the redemption amount and investment income, if any.

When concluding an insurance contract, the insurer has the right to assess insurance risks and at the same time may request various information from the client about him: information about dispensary registration, past or current diagnoses, information about profession and hobbies, etc. This may include a medical examination.

If it is established that the client provided inaccurate or knowingly false information about himself, then this may be fraught with the recognition of the insurance contract as invalid - the insured may lose investment income or lose insurance remuneration for additional. risks. Therefore, it is better to report everything as it is when concluding a contract - this will allow the consultant to take into account all the nuances.

Pros and cons of investment life insurance

ILI, like any financial and insurance product, has its pros and cons. Let's sum up some results and report some more interesting information about such contracts, revealing their advantages and disadvantages.

pros

1. Capital protection. The ILI agreement guarantees the return of 100% of the sum insured, even if the investment strategy chosen by the client turned out to be unsuccessful (due to the downturn in the market, the asset showed negative profitability results). This is an important plus, since no broker will provide you with such guarantees.

2. Receiving investment income (although not guaranteed) + simultaneous insurance coverage of the client's life(the duration of the insurance is 24 hours, the territory of insurance is the whole world). In case of surviving, the client receives his contribution along with the profit, and in case of premature death, the beneficiaries also receive an amount equal to the contribution + received investment income. The ability to insure additional risks with a small additional payment (in relation to the premium) performs the role of risk insurance and makes the product more secure and profitable.

3. The policyholder may appoint one or more beneficiaries at your discretion, and it does not have to be family members. In the event of the death of the insured, there is no need to wait 6 months to receive the money as part of the inheritance. They are paid by the insurance company at the request of the beneficiary (beneficiary). At the same time, legal heirs (if they are not among the beneficiaries) will not be able to claim this money, it is not even challenged in court.

4. Life insurance policies have a special legal status- They are not property. Therefore, they cannot be sued, sent to pay off debts, divided between spouses during a divorce. All funds will be available only to the policyholder.

5. tax benefit. By law, if the term of the contract is 5 years or more, then the insured is entitled to a tax deduction for the money invested in life insurance - 13% of the amount not exceeding 120,000 rubles. The maximum amount of the deduction is 15,600 rubles for each year. In fact, the deduction is already at least a small, but guaranteed income.

6. Favorable taxation. If the received investment income does not exceed the refinancing rate (key rate) of the Central Bank at the end of the contract, then it is not subject to personal income tax. If the income is higher, then personal income tax will have to be paid. In the event of the death of the insured, insurance payments to beneficiaries are not subject to personal income tax.

7. Since the ILI contract is concluded for a long period, then possible deterioration of your health in subsequent years of the policy will not affect the cost of the insurance premium(here we are talking about additional risk programs). If you each entered into a risk insurance contract, then the state of health could affect its cost or, in some cases, become the reason for refusal.

8. The client does not need to spend time learning the basics of investing and getting acquainted with various insurance products. Specialists in the stock market and professional insurers will work with his capital. He can make an independent choice of an investment strategy, in the “line” of which his capital will work.

9. The ability to manage and monitor the program in the personal account of the insured(It is highly desirable to choose an insurer with such capabilities). The client can remotely perform the following operations: changing the fund (changing the chosen strategy), fixing additional investment income, paying additional investment income, making an additional contribution, etc.

Minuses

1. Insecurity of capital in case of bankruptcy of the insurer – capital in the ILI pole is not insured by the deposit insurance agency (DIA). If the license is revoked from the insurer, the payment obligations are transferred to the reinsurer, where the ILI contracts were reinsured. In the absence of reinsurance, the bankrupt insurer must terminate the contracts and pay the insurers the premiums received on them. Otherwise, clients will receive them only in the queue of creditors established by the court.

2. Unfavorable early termination of the contract(loss of funds);

3. Inability to use investment life insurance as an effective way to accumulate capital. No guaranteed return- perhaps the main disadvantage of the product. According to the chosen strategy, the insurer shifts the risks to the client. However, it is worth noting that some companies guarantee a small guaranteed income in the poles.

4. Opportunity to run into exceptions to the contract which may result in it being invalidated.

5. Connection to the contract of additional programs for risky types of insurance may increase the cost of the contract.

6. Funds invested in the insurance program will be eaten up by inflation year after year, which can only be covered by the benefit from investment income. And if it is not, then, alas.

Who benefits from the ILI program?

Due to the lack of income guarantees, the investment life insurance program loses to a classic bank deposit, where your income will be known already during the execution of the deposit agreement. To have more, you need to gain knowledge and experience, and only then “climb” into investments (for example, get access to the stock exchange through a broker and buy stocks, bonds or other products on your own).

In ILI, you have the opportunity to plunge into the world of investments without knowledge, although you will still be asked to choose an investment strategy, that is, you will have to strain your gray matter a little. And at the same time, you do not risk your money, and in this the ILI policy is unique. You either get a lot, or stay with yours.

The basic insurance coverage of this product, to put it mildly, is about nothing: what is the point of insurance if the sum insured is equal to your premium, when you can insure your life much cheaper? Cumulative insurance in this regard gives much more profitable when a person pays a part of the contract amount every year, and his relatives receive the full amount, even if he passes away prematurely in the first year of the contract.

But it is quite profitable to draw up additional programs for risk insurance within the ILI due to large insurance payments as a result of the risk of death or disability as a result of an accident.

As customer reviews show, investment income on real contracts in rare cases exceeds 10%, and generally loses to the average rate on deposits. Although the real reports of representatives of the insurance business show a different alignment.

Therefore, in most cases it would be more expedient to put your money on a deposit (no more than 1.4 million rubles in one bank) and insure yourself against risks in one of the many insurance companies. In addition, you can use part of your funds to invest in risky assets and try your luck on your own, at least you can withdraw your money at any time without any restrictions, and you will not have to share the income received with an insurance company (there, By the way, people don't work for free.

But if you want to take advantage of the special status of ILI policies, and, for example, legally protect your money from confiscation, arrest or division during a divorce, then this is your option.

In general, ILI may be of interest to those who have free money, and who care that they work, but do not have experience in independent investment analysis. ILI is exactly the tool that makes investments risk-free (the client runs the risk of not receiving income), because the money deposited in the worst case will be fully returned to their owner, and in the best case they will bring quite tangible profits.

We are talking about the case when an insurance company entered into a life insurance contract with an individual, under which the insured person, in addition to the right to receive insurance payment upon the occurrence of an insured event, acquired the right to receive investment income resulting from the investment by the insurer of a part of the amount contributed by the individual as an insurance premium, into underlying assets. According to the rules of insurance, additional investment income is paid upon the occurrence of an insured event as part of the insurance payment, and in the event of early termination of the insurance contract - as part of the redemption amount (clauses 6-7 of article 10 of the Law of the Russian Federation dated November 27, 1992 No. 4015-I " ").

The Tax Code of the Russian Federation recognizes as income an economic benefit in cash or in kind, taken into account if it is possible to assess it and to the extent that such benefit can be assessed, and determined for individuals in accordance with Chapter 23 "" of the Tax Code of the Russian Federation ().

According to insurance payments upon the occurrence of an insured event, including periodic insurance payments (rents, annuities) and (or) payments related to the participation of the insured in the investment income of the insurer, as well as redemption amounts received from a Russian organization, relate to income from sources in RF for the purposes of calculating personal income tax.

Are the amounts of insurance premiums paid under a contract of voluntary life or health insurance of an employee subject to personal income tax in the absence of payments to insured individuals? For the legal positions of the courts on this issue, see the section "Tax Code of the Russian Federation" "Encyclopedia of judicial practice" Internet version of the GARANT system.
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At the same time, it provides that when determining the tax base for personal income tax, income received by the taxpayer under voluntary life insurance contracts related to the survival of the insured person to a certain age or period, or in the event of another event, is not taken into account. Such payments are not subject to personal income tax subject to the following conditions:

  • insurance premiums under a voluntary insurance contract are paid by the taxpayer or members of his family, or close relatives in accordance with (spouses, parents and children, including adoptive parents and adopted children, grandfather, grandmother and grandchildren, full and half brothers and sisters);
  • the amounts of insurance payments do not exceed the amounts of insurance premiums paid by the taxpayer, increased by the amount calculated by successively summing up the products of the amounts of insurance premiums paid from the date of conclusion of the insurance contract to the day of the end of each year of the validity of such an agreement (inclusive), and the average annual Bank of Russia effective in the corresponding year .

Financiers emphasize that since tax exemption for other payments, in particular, amounts of additional investment income under a voluntary life insurance contract, is not provided for by the Tax Code of the Russian Federation, these amounts are subject to taxation in the generally established manner.