Single Premium Plan. Key Features Document

Transcription

1 Single Premium Plan Key Features Document

2 This Fact Sheet contains a summary of the main features of your Plan. Please read it carefully so that you understand what you are buying and the risks involved. Plan description A with-profits single premium endowment. The Plan participates in our distribution of profits. With-profits investment smoothes the return on your money by spreading the profits over good and bad years. Its aims To give you the potential for medium to long-term tax-efficient capital growth. To give you access to your money by making one-off withdrawals or regular annual withdrawals. Your commitment To invest a minimum lump sum payment of 5,000 but you have the option to make additional Top-Ups whenever you want. No Top-Ups can be made within 5 years from the maturity date of the Plan. You determine the duration of the Plan when you start the Plan. You are free to choose the duration you require subject to a minimum of 5 years. Risk factors What you might get back will depend on our investment performance and is not guaranteed. It may be less than illustrated if the performance of the investment is lower than illustrated or if you take out money from your Plan before its maturity date. If you cash in your investment before the end of 3 years from the date of investment you will receive less than the Policy Account. This will happen either as a result of surrender charges or if we are forced to apply a Market Value Reduction (MVR). MVR may be applied if the value of our investments falls suddenly. The returns you get on with-profits investments depend on a number of factors including: - The return on investments in our underlying with-profits fund - The way we distribute any profits on the fund - Factors beyond our control, such as tax and the effect of inflation - Profits and / or losses from non-participating plans (other than unit-linked plans) which are also part of the with-profits fund - The cost of meeting any guarantees that we provide. The rate of future bonuses cannot be guaranteed and may also change over the years. Inflation will reduce the value of any cash sum and this is something you should be aware of when considering what you may be able to buy with a cash sum in the future. Key features Minimum Premium Withdrawal of Regular Bonus Minimum Term Age limits of Person Covered when the Plan starts when the Plan finishes Policy Owner Basis of Life Cover First Premium 5,000 (if the Plan is taken out before the age of 75 years) 10,000 (if the Plan is taken out at or after the age of 75 years) Top-Ups (optional) Option to make additional Top-Ups (subject to a minimum of 500) during the term of the Plan. No Top-Ups can be made within 5 years from the maturity date of the Plan. Regular Bonus may be withdrawn at no charge within 30 days from receipt of Policy Account Statement (or declaration of bonus by MSV in the newspapers) but not later than 31st August. The minimum amount that can be withdrawn is years. Minimum of 3 months and maximum of 85 years. Maximum of 90 years. The Policy Owner can be any natural person aged at least 18 years old or any corporate entity. The Plan may also be owned by a child (with a minimum age of 3 months), in which case the policy ownership is to be designated in the name of the child c/o the parent/s or guardian. Single Life OR Joint Life First Death OR Joint Life Second Death.

3 Beneficiary Life Insurance Trust You can appoint one or more beneficiaries to receive the benefit under the Plan, when this is due. There is no charge for this arrangement to be implemented and it requires only the completion of a simple form. The appointment of a beneficiary (and acceptance thereof) under a life insurance contract does not need to be confirmed in a will and it also supersedes the provisions of a will if there is any conflict between the two. The Plan can be written in Trust with BOV as Trustee. This shall be effected by means of an irrevocable Declaration of Trust Agreement, pursuant to which the Trustee shall become the Policy Owner and the Primary Beneficiary of the Plan by accepting under Trust the beneficial interest in the Plan. Plan benefits Death Benefit Funeral Expenses Benefit Maturity Benefit Cash Surrender Benefit Payment of 101% of the single premium paid (or 101% of the Policy Account whichever is higher) if the Person Covered is 70 years old or younger at the time of death OR Payment of 100% of the single premium paid (or 100% of the Policy Account whichever is higher) if the Person Covered is 71 years old or older at the time of death. Payment of the cost of funeral expenses (subject to a maximum of 2,500) in the form of a partial pre-payment of the Death Benefit. Payment of the Policy Account upon maturity of the Plan. Option to surrender the policy in part or in full before maturity. The surrender amount is based on the Policy Account and subject to the application of surrender charges and MVR (if applicable). Partial cash surrender may be made: after 3 years from the date of investment subject to retention of at least 5,000 in the Policy Account subject to a minimum withdrawal of 500. Plan charges Policy Fee Top-Up Fee Allocation Charge 100 charged once when the First Policy is issued. This is reduced to 25 in the case of the second or any subsequent Single Premium Plan. 25 charged when and if Top-Up Premiums are paid. A percentage deduction from the premium paid (both first and Top-Up) will be made in accordance with the allocation bands tabulated hereunder: Allocation band Allocation charge Premium paid 1 3% Up to 69, % Between 70,000 and 114, % Between 115,000 and 229, % Over 230,000 Surrender Charge Market Value Reduction 3.0% within 1 year from the Date of Investment. 2.0% after 1 year but before the end of 2 years from the Date of Investment. 1.0% after 2 years but before the end of 3 years from the Date of Investment. 0% after 3 years. If you take out money from your Plan, we retain the right to effect an MVR and increase the surrender charge. This adjustment is designed to protect investors who are not taking their money out and its application means that you get a fair share of the with-profits fund in which your payments are invested. MVR cannot be applied: upon maturity of the Plan. in the event of the payment of the Death Benefit. All charges are reviewable and may be changed after the Plan is started, but we will give you 90 days notice if they are changed. We reserve the right to change the terms for future non-contractual premiums (eg. single premium Top-Ups), without notice.

4 Questions and answers 1. What might I get back? The maturity value of the Plan depends on a number of factors such as the amount you invest any bonuses added to your Plan our charges any amount that you take out of the Plan before it matures We are giving hereunder some examples of the expected Maturity Values for specific circumstances. Premium Paid Assumed Regular Bonus rates 3% 3.5% 4% Maturity Value of Plan after 10 years 5,000 6,388 6,705 7,036 10,000 12,906 13,546 14,215 25,000 32,460 34,071 35,753 50,000 65,050 68,278 71,649 Maturity Value of Plan after 15 years (including Final Bonus) 5,000 7,406 8,163 8,988 10,000 14,962 16,491 18,160 25,000 37,630 41,477 45,674 50,000 75,411 83,120 91,530 Maturity Value of Plan after 20 years (including Final Bonus) 5,000 8,585 9,931 11,456 10,000 17,345 20,064 23,146 25,000 43,624 50,463 58,215 50,000 87, , ,663 Illustrated Maturity Values include a Final Bonus calculated at 0.5% of the policy account for every year in excess of 10 years. Illustrated Maturity Values include a Final Bonus calculated at 1.0% of the policy account for every year in excess of 10 years. 2. How long will my money be tied down for? The duration of the Plan is entirely at your discretion, subject only to a minimum of 5 years. We suggest that you choose the duration to fit your investment time horizon so that your Plan matures when you anticipate that you will need the money. 3. Where and how is my money invested? After applying the Plan charges, we put your money in our with-profits fund. Our with-profits fund is invested in a range of investments including shares, bonds, property and short-term assets. The mix of these assets is determined by us with the objective of maximising the rate of return whilst preserving the real capital value of the investments. 4. What is my tax position under the Plan? Under current legislation you are not liable to income tax whether you surrender the Plan or retain it to maturity, so however that tax at the rate of 15% is payable by the insurer on profits attributable to such plans on surrender or maturity, where the policy owner is resident in Malta. Payment of the Death Benefit under the Plan is not taxable. Please bear in mind that tax legislation may change in future. 5. How is the growth of my Plan determined? When you invest in our with-profits fund, you share in the potential profits of MSV in the form of Bonuses. The value of your Plan grows with the addition of Regular Bonuses. A Regular Bonus is calculated as a percentage of the Policy Account and is added to the Policy Account on a daily basis. We guarantee that when a Regular Bonus is added to your Plan it is locked and cannot be taken away, if you hold the Plan until it matures. In addition, we may also add a Final Bonus upon payment of the Maturity Benefit or the Death Benefit.

5 The bonuses will depend on factors such as investment performance, charges and other profits or losses made by our withprofits fund. The main aim in determining bonuses is to smooth out the ups and downs of the stock market. The process of smoothing leads to returns that are steadier than if they fully reflected the underlying value of the assets of the with-profits fund. We may apply a Market Value Reduction when you cash in all or part of your Plan which will reduce the amount payable. This can happen when there has been a large or lengthy fall in stock markets or when investment returns have been consistently lower than expected. 6. How will I know how my Plan is performing? We will send you an annual valuation showing the value of your Plan. 7. Can I change my mind? You can change your mind within 30 days from when you get your Plan documents. If you decide, for any reason, within this period that you don t want to proceed with the Plan, we will give you your money back. If you wish to exercise your right to cancel, you should complete and return the Cancellation Notice that we send you. Other informatiom Terms & Conditions: This Fact Sheet is intended to provide a brief overview of the Single Premium Plan. The full terms and conditions are explained in more detail in the policy document, a copy of which is available from our offices. Effective Date: The features outlined in this Fact Sheet are applicable to any Single Premium Plan that starts after Compensation: In the unfortunate event of insolvency of any company licensed to carry on Insurance Business in Malta you may be entitled to limited compensation under the Protection and Compensation Fund. Glossary / Definition of terms Bonuses are the way we allocate to you your share of the profits of the with-profits fund. There are 2 types - REGULAR, which are normally added every year - FINAL, which may be paid when your Plan matures, provided it has been in force for at least 10 years, or when we pay the Death Benefit under the Plan. Endowment is a life insurance policy that has a fixed duration and that pays a Maturity Benefit on the maturity date of the policy or a Death Benefit if the Person Covered dies before the policy matures. Person Covered means the person or persons, specified in the policy, whose death will result in the Death Benefit under the Plan becoming payable. The Person Covered can only be a natural person and cannot be a company. Plan means the life insurance contract described in this Fact Sheet. Policy Account means all the Premiums paid (net of charges) and any subsequent Bonuses added. We, us or MSV mean MSV Life p.l.c. You / Policy Owner means the person who has all the rights (e.g. to receive the Plan Benefits) and obligations (e.g. to pay the premium) under the Plan. The Policy Owner can be either a natural person or a company. COM A5 Registered Address: MSV Life p.l.c., Middle Sea House, Floriana, FRN 1442, Malta. Postal Address: P.O. Box 54, Marsa, MRS 1000, Malta. Registration Number: C15722 Telephone: (+356) Telefax: (+356) [email protected] Website: MSV Life p.l.c. is authorised by the Malta Financial Services Authority to carry on long term business under the Insurance Regulations Act 1998.