The AIB Personal Pension Protection Plan. Life assurance from AIB to complement your pension plan

Transcription

1 The AIB Personal Pension Protection Plan Life assurance from AIB to complement your pension plan

2 Contents AIB Protection Plans 1 The AIB Personal Pension Protection Plan 2 A summary of the benefits 3 The life assurance benefit 4 The premiums 6 Conversion option 7 Tax relief 8 Ongoing flexibility & service 9 A commitment to quality service 10 Statutory Information 11

3 t h e a i b p e r s o n a l p e n s i o n p r o t e c t i o n p l a n AIB Protection Plans Life assurance protection is the most important part of financial planning. It is the practical way to ensure that, if the worst were to happen, your family would have sufficient money to maintain their lifestyle. AIB offers a wide range of protection Plans, enabling customers to choose an arrangement that matches their needs and circumstances: The AIB Safeguard Plan provides you with a combination of life assurance and specified illness cover to suit your protection needs. By paying a significant cash sum on death and/or on diagnosis and certification of a specified illness*, this Plan can help protect you and your family from the financial effects that a death or specified illness may bring. You choose how long you want the cover for which may be anything from a few years to several decades. The AIB Lifelong Protection Plan provides life assurance cover for the rest of your life. So it is ideal for people who are unsure how long their need for life assurance will last or for those that require lifelong cover for family protection or inheritance tax liability provision. The AIB Mortgage Protection Plan is designed to pay off your mortgage in the event of your death. Borrowing money to buy your own home is the largest single financial commitment that you will probably ever make. So, it is important to ensure that, if you die before the mortgage has been fully repaid, sufficient life assurance will be paid out to clear it. That is what the AIB Mortgage Protection Plan is designed to provide. You can also complement your AIB Mortgage Protection Plan with Specified Illness Cover which is designed to provide a cash sum to pay off your mortgage in the event of a specified illness*. The AIB Personal Pension Protection Plan which provides life assurance cover to run alongside your personal pension plan, is the Plan described in this brochure. *Please see the AIB Specified Illness Definitions Guide for full details of illnesses covered. The above Plans are all issued by Ark Life Assurance Company Limited, a subsidiary of Aviva Life Holdings Ireland Limited, a joint venture company between Aviva Group Ireland plc and Allied Irish Banks, p.l.c. 1

4 The AIB Personal Pension Protection Plan

5 t h e a i b p e r s o n a l p e n s i o n p r o t e c t i o n p l a n The AIB Personal Pension Protection Plan The AIB Personal Pension Protection Plan has been carefully designed to operate alongside your personal pension plan, such as a PRSA, to provide a high level of financial security for your family in a low-cost and taxefficient way. You are obviously aware of the need to plan your personal finances carefully, because you are already saving up to provide yourself with an income when you retire. However, it is also important to ensure that, if you were to die before retirement, your family would receive sufficient money to maintain their standard of living. Most of us believe that we will live to a ripe old age but the fact is that every day, people die, leaving families and loved ones to manage on their own. You never know what s around the corner so arranging financial protection for your family should be high on your list of priorities. The AIB Personal Pension Protection Plan is a highly affordable Plan that is designed to provide Life assurance protection For the amount you need For the period up to your chosen retirement age With income tax relief on the premiums. A summary of the benefits If you die before the specified retirement age under your personal pension plan, the AIB Personal Pension Protection Plan will provide a cash sum for your dependants: You can arrange whatever amount of life cover you wish and your AIB Financial Adviser will be pleased to help you calculate an appropriate amount of cover for your family s needs and select the most appropriate retirement age for your Plan. The Plan provides pure life assurance with no savings element. Your plan automatically increases your cover by 5% every year (indexation) without the need to provide evidence of good health - a valuable benefit, ensuring your level of cover is protected from the effect of inflation (see page 6). Your premiums will qualify for income tax relief (see page 8). There are favourable terms for non-smokers. If you choose to add a conversion option to your policy at outset, then, at any time before your policy expires and regardless of your state of health at the time you may convert the Plan into a new policy that will provide you with life assurance for a longer period of time or for the rest of your life (subject to conditions, see page 7). AIB offers a free review of your financial plans, to check that they are still on course to satisfy your overall financial needs and, in the light of any changes in your circumstances or requirements, to advise you how to arrange any additional cover that you may need. 3

6 t h e a i b p e r s o n a l p e n s i o n p r o t e c t i o n p l a n The life assurance benefit This Plan is designed to pay out a cash sum in the event of your death before the retirement age that you have chosen under your personal pension plan. This should help your family to overcome the financial difficulties they may encounter. The life cover The premium for your life cover is guaranteed from the outset. You simply have to keep your premium payments up to date. You should note that, as soon as you retire and you have started to take your benefits from your personal pension plan, your AIB Personal Pension Protection Plan cannot continue to provide you with cover and you must cease the policy with us. However, as described under Conversion option on page 7, the Plan can include a valuable option for you to convert to another policy that will cover your life for longer. If you don t select this option at outset or you don t exercise this conversion option, your life assurance cover will cease at the end of the original policy term. Eligibility The AIB Personal Pension Protection Plan is available to the self employed and those in non-pensionable employment who are aged at least 18. The Plan is not available to anyone who is provided with pension benefits by his or her employer. The AIB Personal Pension Protection Plan can be written on a single life basis only. You must be no older than 72 when the Plan starts, unless you selected the conversion option, in which case you must be no older than 59. Ark Life reserves the right to decline the conversion option, should you be ineligible for cover at standard rates under this Plan. Immediate cover We will provide you with free accidental death cover while your application for an AIB Personal Pension Protection Plan is being considered. Accidental death means a death occurring before age 65 and within 12 months of an accident due to accidental bodily injury arising solely and directly from external violent, visible and accidental causes, totally independent of any physical or mental illness or infirmity. Your accidental death cover will start on the day we receive your fully completed application and continue until the earliest of three dates: 1 The end of 3 months, or 2 The date that the cover provided by your Plan comes into effect, or 3 The date you are informed that your application has not been accepted at ordinary rates. Should death occur within 12 months of an accident that occurred while Accidental Death Benefit was in place, the full amount of life assurance cover for which you have applied will be paid out, up to a maximum of E150,000. Accidental Death Benefit will not be paid if death is caused directly or indirectly by any of the following: self inflicted injury including suicide or attempted suicide, engaging in a hazardous pursuit, war (whether declared or not, riot or civil commotion), 4

7 t h e a i b p e r s o n a l p e n s i o n p r o t e c t i o n p l a n taking alcohol or drugs (unless they are prescribed by a registered doctor in the Republic of Ireland), committing, attempting or provoking an assault or criminal offence, taking part or attempting to take part in any aerial flight other than as a fare paying passenger on a licensed airline, death in a country outside the EU, engaging in a hazardous occupation, an assault on the covered person which is not reported to the police, disease, bodily or mental infirmity or medical or surgical treatment of these or where the covered person acts against medical advice. Notification of death must be received by Ark Life within 12 months of the date of death. Non-smoker discount Medical statistics show that, as a group, non-smokers live longer than smokers. Recognising this, Ark Life offers a substantial discount if the person to be insured hasn t smoked any form of tobacco during the last 12 months. Medical evidence You will be asked to complete an application form, giving us details of your medical history. According to the answers you give and the amount of life cover that you have requested we may require further information. In some circumstances, we may ask you to attend a medical examination at our expense. You should note that all the questions on the application form must be answered fully and accurately. If you are not sure whether or not to give us any information about your past or present health, you should do so as failure to disclose any relevant information could invalidate your life cover. How your family can claim In the event of your death, your family (or any legal representative acting for them) should notify Ark Life as soon as possible, preferably in writing. Some formalities will be necessary, including the production of the policy document. However, these requirements will be kept to a minimum and we will act promptly to ensure that payment is made as soon as possible. Replacing an existing policy If you are thinking of starting an AIB Personal Pension Protection Plan to replace an existing policy, you should ensure that you are fully aware of the financial consequences. For example, if you took out your previous policy some time ago, the cost of your existing life assurance benefit may be cheaper than under a new policy. If the policy to be replaced is with Ark Life, you should discuss the implications with your AIB Financial Adviser. 5

8 The premiums The cost of your AIB Personal Pension Protection Plan will depend on: The amount of life cover that you require. The length of time that you wish your Plan to run. Your age and sex. Whether you are a smoker or a non-smoker. Your current state of health. All the charges (including any Government levy applicable at the time) are automatically included in the premiums. Your AIB Financial Adviser will provide you with an illustration of the benefits and costs. Automatic indexation of premiums protecting your cover from the effects of inflation With the AIB Personal Pension Protection Plan, the benefit payable in the event of a life claim will automatically increase by 5% each year, on the anniversary date of your policy. To meet the cost of these increases in your cover, your premiums will increase on each anniversary by 8%. If you wish, you can choose to decline this valuable feature at the outset of your plan, just tick the box on the application form and your cover and premiums will remain level throughout the term of your policy. Unless declined at outset, these automatic increases will continue each year until: 6 the policy anniversary prior to your 65th birthday or before if the policy ceases. You also have the comfort of knowing that in the future, you can also decline this automatic increase on any anniversary date, you must notify us in writing within 10 days of the date on which your cover would otherwise have increased. If you decline the increases in two successive policy years, your policy will no longer be eligible for subsequent increases. If your application is accepted on special terms, Indexation of premiums may be declined. Your AIB Financial Adviser will be able to assist you with any questions you may have with regard to the indexation of your cover. Premium details Premiums may be paid monthly or annually in advance. Monthly premiums must be paid by direct debit; annual premiums may be paid by direct debit or cheque. If you subsequently wish to change from paying monthly to paying yearly or vice versa you may do so on any anniversary date. Minimum premium The minimum premium is E20 per month or E200 per annum. Premium payments You must pay the premiums yourself; they cannot be paid by your employer. All premiums should be paid promptly although we will allow up to 30 days of grace to cover the late payment of a premium. If a premium is delayed any longer, the Plan will lapse and your life cover will stop. If you do not die during the period of cover, the Plan will stop and no benefit will be payable. If you stop paying the premiums early, your cover will cease and the Plan will have no cash-in value.

9 t h e a i b p e r s o n a l p e n s i o n p r o t e c t i o n p l a n Conversion option The Plan includes a valuable option to extend your cover, if you wish, by converting your AIB Personal Pension Protection Plan to a new life cover policy. This option will only apply if specifically chosen by you at outset and may be excluded from your policy if you are accepted for cover at special terms. You may exercise your conversion option at any time before your 65th birthday. The Plan includes a valuable option to extend your cover, if you wish, by converting your policy to: a A new protection plan with Ark Life that will provide you with life assurance for a longer period of time, or iii The new plan will be subject to the standard conditions then applying to that type of life assurance policy. iv The new plan will not include any further conversion option. v The new plan will not include an indexation option. b A whole of life protection plan with Ark Life that will provide you with life assurance for the rest of your life. Important Ark Life reserves the right to offer alternative cover options for conversion in place of a and/or b above. You may not be eligible to claim tax relief on premiums paid to the above policies in a or b. You may exercise this option at any time during the original policy term, without needing to supply us with any further medical evidence no matter what your state of health is at the time. This conversion option is subject to the following conditions: i The amount of your cover under the new policy cannot be higher than it was under the original Plan. ii The premiums payable to the new plan will be calculated based on your age and on the rates applying at the time of conversion for the plan selected. If any special terms were applied to your original policy, these will also be applied to your new policy on conversion. 7

10 t h e a i b p e r s o n a l p e n s i o n p r o t e c t i o n p l a n Tax Relief Allowable premiums Premiums will qualify for income tax relief at the highest rate of tax you pay provided that, when added to your pension contributions, the combined amount you are paying does not exceed the maximum amount that the Revenue will allow you for tax relief purposes. If you are in non-pensionable employment, your net relevant earnings can be broadly defined as your total earnings, less any mortgage interest relief that you claim. If you are self-employed, your net relevant earnings can be broadly defined as total earnings from self-employment, less your allowable business expenses, losses and capital allowances. Please note, if you exercise a conversion option, the premiums payable to your new policy may not be eligible for tax relief. Claiming your tax relief Ark Life will send you a Retirement Annuity Certificate with your policy document. This is the form that the Revenue require in order to grant you income tax relief as it will state the premiums that you have agreed to pay to the Plan. If you are taxed under the PAYE system, you should forward the Certificate to your tax inspector as soon as you can. Your tax-free allowance will then be appropriately increased and the amount of tax deducted from your pay will be reduced. On the other hand, if you are taxed under the selfassessment procedure, you should forward the Certificate to your tax inspector when you make your return. You will benefit from the relief when you settle your tax bill. 8

11 t h e a i b p e r s o n a l p e n s i o n p r o t e c t i o n p l a n Ongoing flexibility and service Non-assignability You should note that, because the AIB Personal Pension Protection Plan is written under the pensions legislation (which is why the premiums will qualify for income tax relief), it may not be assigned to a third party nor may it be used as security for a loan. Reinstatement If your AIB Personal Pension Protection Plan lapses, you may reinstate it at any time within the following 6 months. However, this will be at Ark Life s discretion and will be subject to you providing us with satisfactory evidence of your ongoing good health and paying all the outstanding premiums, plus any late payment charge. Ongoing service As time goes by, changes in your circumstances and responsibilities may result in a change in the amount of life assurance cover that you need particularly if you wish to protect your family against the full financial consequences that could otherwise make life very difficult for them after your death. To take account of this, your AIB Financial Adviser will be pleased to carry out a free annual review, to check that you are still covered for the benefits that would meet your family s needs and, if necessary, to recommend the most suitable way of arranging any additional life assurance that you may require. 9

12 t h e a i b p e r s o n a l p e n s i o n p r o t e c t i o n p l a n A commitment to quality service Ark Life is committed to the provision of the highest possible standards of customer service. However, if you are ever dissatisfied with any aspect of our service, do please let us know. We take all complaints very seriously and aim to rectify any shortcomings as speedily as possible. If you wish to complain about any aspect of the service you have received, please contact Ark Life directly. If your complaint is not dealt with to your satisfaction, you may complain to: Financial Services Ombudsman s Bureau, Address: 3rd Floor, Lincoln House, Lincoln Place, Dublin 2 Lo-call: Fax: (01) enquiries@financialombudsman.ie Website: Full details of the remit of the Financial Services Ombudsman s Bureau can be obtained directly from their office. Ensuring the policy meets your needs We only want you to have an AIB Personal Pension Protection Plan if you are satisfied that it is the right plan for you. So, shortly after your AIB Personal Pension Protection Plan has started, we will send you the full documentation governing your Plan. You will then have a cancellation period of 30 days from the date on which your Plan documentation is issued to change your mind. Study the documents and, if you would like to cancel the arrangement, simply return the documents and a signed notice of cancellation to: The Customer Services Manager, Ark Life Assurance Company Limited, One Park Place, Hatch Street, Dublin 2. We will cancel your AIB Personal Pension Protection Plan and return all the money you have paid. To enable Ark Life to assess the quality and consistency of its customer service, phone calls to and from our office may be recorded from time to time. Copy documents A copy of the application form, policy documents and policy conditions for the AIB Personal Pension Protection Plan is available on receipt of a written request by or on behalf of the applicant. 10

13 The AIB Personal Pension Protection Plan STATUTORY INFORMATION Statutory Information provided in accordance with Regulation 6(1) of the Life Assurance (Provision of Information) Regulations, 2001 A. INFORMATION ABOUT THE POLICY 1 MAKE SURE THE POLICY MEETS YOUR NEEDS (i) The purpose of the policy is life assurance protection for the period of time up to your chosen retirement age. (ii) The policy is a term assurance policy that provides life cover only. Specified illness cover and permanent health insurance are not included. (iii) The policy never acquires a cash-in value. On survival to the end of the term, the life cover ceases and no benefit is payable. (iv) You have committed to pay regular monthly or yearly premiums, in order to maintain life assurance cover throughout the term of the policy. Unless you are fully satisfied with the nature of this commitment, taking into account your financial needs and resources, you should not start a AIB Personal Pension Protection Plan. (v) We are required to advise you, if appropriate, about the financial consequences and possible financial loss that could result from arranging an AIB Personal Pension Protection Plan to replace, in whole or in part, an existing policy with Ark Life or any other life assurance company which has been, or is to be, cancelled or reduced. If you are substituting all or part of any existing policy in this way, you must advise us of this in your application form, so that the implications and possible financial loss can be explained to you by an AIB Financial Adviser. You must also tick the relevant box on the application form and sign to show that the relevant statement is correct. WARNING If you propose to take out this policy in complete or partial replacement of an existing policy, please take special care to satisfy yourself that this policy meets your needs. In particular, please make sure that you are aware of the financial consequences of replacing your existing policy. If you are in doubt about this, please contact your insurer or insurance intermediary. STATEMENT ON REPLACEMENT POLICIES You should NOT reduce or cease an existing life assurance policy in order to replace it with an AIB Personal Pension Protection Plan without firstly seriously considering the implications of doing this. The financial consequences could prove very serious indeed, for either yourself or your dependants, if you were to reduce your protection in this way. 2. WHAT HAPPENS IF YOU WANT TO CASH-IN THIS POLICY EARLY OR STOP PAYING THE PREMIUMS? The policy never acquires a cash-in or surrender value. If you cease paying premiums, your life assurance cover will stop and no benefits will be payable. 3 WHAT ARE THE PROJECTED BENEFITS UNDER THE POLICY? ILLUSTRATIVE TABLE OF PROJECTED BENEFITS AND CHARGES Year Total amount of premiums paid into the policy to date (e) Projected investment growth to date (e) Projected expenses and charges to date (e) Projected cost of protection benefits to date (e) Projected policy value A B C D E=A+B- C-D , , , , , , , , , , , , Maturity 22, , , The indexed monthly or annual premiums payable include the cost of the protection benefits and all charges, expenses and intermediary/ sales remuneration. The benefits illustrated in the above Table and the next Table are for an AIB Personal Personal Pension Protection Plan with a sum insured of E150,000, a regular premium (indexed) of E25.75 per month for a 40 year old male next birthday to Retirement age 65, who is a nonsmoker. The premium amount takes into account a Government levy of 1% on life assurance policies. 4. WHAT INTERMEDIARY/SALES REMUNERATION IS PAYABLE ILLUSTRATIVE TABLE OF INTERMEDIARY/SALES REMUNERATION Year Premium payable in that year (e) Projected total intermediary/sales remuneration payable in that year (e) , Year of Maturity - - (e) The projected total intermediary/sales remuneration shown above represents the amounts payable by Ark Life to AIB Bank. 5. ARE RETURNS GUARANTEED AND CAN THE PREMIUM BE REVIEWED? Both the life assurance benefit and the premiums are guaranteed. 6. CAN THE POLICY BE CANCELLED OR AMENDED BY THE INSURER? (i) Ark Life may change the terms of your policy in order to comply with, or take account of, any future changes in tax and/or other legislation. (ii) If you cease paying the premiums to the policy, Ark Life will stop your life assurance cover. 11

14 The AIB Personal Pension Protection Plan STATUTORY INFORMATION Continued (iii) If you fail to disclose all material facts on your application for the policy, Ark Life could cancel your policy, and all the premiums paid could be forfeited. Material facts are those that an insurer would regard as likely to influence the assessment and acceptance of an application for life assurance. If you are in doubt as to whether any facts are material, such facts should be disclosed. 7. INFORMATION ON TAXATION ISSUES The amount payable on death is not subject to income tax or capital gains tax, although it may be subject to inheritance tax when it is paid to your beneficiaries. 8. ADDITIONAL INFORMATION IN RELATION TO YOUR POLICY (i) After your application is accepted, you will receive a notice of your right to cancel your policy within the following 30 days. If you would like to cancel the arrangement, simply return the documents and signed notice of cancellation to The Customer Services Manager, Ark Life, One Park Place, Hatch Street, Dublin 2. If you return the policy to us during this period, we will cancel it and return any premiums you have paid. (ii) The contract between us is subject to the laws of the Republic of Ireland. (iii) For further information or if you wish to complain about any aspect of the service you have received please contact Ark Life directly. If your complaint is not dealt with to your satisfaction, you may complain to: Financial Services Ombudsman s Bureau, Address: 3rd Floor, Lincoln House, Lincoln Place, Dublin 2 Lo-call: Fax: (01) enquiries@financialombudsman.ie Website: Full details of the remit of the Financial Services Ombudsman s Bureau can be obtained directly from their office. B. INFORMATION ABOUT THE INSURER/INSURANCE INTERMEDIARY (i) The AIB Personal Pension Protection Plan is issued by Ark Life Assurance Company Limited, a subsidiary of Aviva Life Holdings Ireland Limited, whose principal business is the provision of life and pensions business. (ii) You can contact Ark Life: By post or personal visit: One Park Place, Hatch Street, Dublin 2 By telephone: (01) By fax: (01) By info@arklife.ie (iii) The AIB Personal Pension Protection Plan is promoted by AIB Bank. (iv) You can contact AIB Bank: At any AIB Bank branch. (v) The sales employee is an AIB Financial Adviser. His/her name is shown in the box below. (vi) You can contact an AIB Financial Adviser at any AIB Bank branch (vii) Ark Life is based in the Republic of Ireland. (viii) Ark Life Assurance Company Limited is a subsidiary of Aviva Life Holdings Ireland Limited, a joint venture company between Aviva Group Ireland p.l.c. and Allied Irish Banks, p.l.c. (ix) AIB Bank is a tied agent of Ark Life for life and pensions business. (x) Ark Life Assurance Company Limited and Allied Irish Banks, p.l.c. are regulated by the Financial Regulator. C. INFORMATION TO BE SUPPLIED TO THE POLICYHOLDER DURING THE TERM OF THE INSURANCE CONTRACT You have the right to receive the following information during the term of your AIB Personal Pension Protection Plan: a. Any change in the name of the insurer; b. Any change in the legal form of the insurer; c. Any change in the address of the head office of the insurer; d. Any alteration to any term of the insurance contract evidenced by the policy which results in a change to the information above on premiums and benefits and/or the information in Section A8 above. The name of your AIB Financial Adviser is His/Her signature AIB Bank Branch Date Notes 1. This brochure is based upon Ark Life s understanding of current law, tax and Revenue practice, July Unless specifically agreed to the contrary, Irish law shall apply. All terms and conditions, information and communication relating to this product will be in English. 2. Ark Life has taken great care to ensure that the information contained in this brochure is correct. However, the company cannot accept responsibility for its interpretation, nor does it provide legal or tax advice. 3. Please note that this brochure is only intended to act as a guide. It is not a legal document and, should there be any conflict between the brochure and the policy document, the latter will prevail. 12

15 This brochure has been produced by Ark Life Assurance Company Limited, a subsidiary of Aviva Life Holdings Ireland Limited, a joint venture company between Aviva Group Ireland plc and Allied Irish Banks, p.l.c. Great care has been taken to ensure the accuracy of the information it contains. This brochure is not a legal document and, should there be any conflict between the brochure and the policy document, the latter will prevail. Copyright Ark Life Assurance Company Limited, July

16 Ark Life Assurance Company Limited One Park Place, Hatch Street, Dublin 2 Telephone: (01) This product is provided by Ark Life Assurance Company Limited, a subsidiary of Aviva Life Holdings Ireland Limited. Aviva Life Holdings Ireland Limited is a joint venture company between Aviva Group Ireland plc and Allied Irish Banks, p.l.c. Ark Life Assurance Company Limited and Allied Irish Banks, p.l.c. are regulated by the Financial Regulator. Terms and Conditions apply.