There are life insurance, literally, of all colors. So, we understand that it is very difficult to know all of them. For that, there are insurance distributors and the insurance companies themselves, which can help you, and also initiatives such as Saving gives a lot of life that, intuitively, help you know which product best suits your profile and needs as a saver. Today we are going to talk to you about one of the lesser-known life insurance: unit-linked, how does this savings insurance work?
Unit Linked insurance has many possibilities, especially if you are one of those who, in addition to worrying, want to take care of their savings. Let's see what characterizes it.
Unit Linked Features
In most savings insurance, the insurer guarantees you minimum profitability or, if you prefer, sets a profitability floor below which the earnings from your savings will never fall. Giving you a guarantee, however, has one condition: you invest your savings in the portfolio in which the insurer does, without being able to make any decision about it. If the insurer is the one who assumes the financial guarantee, logically, it also demands total sovereignty over what it will invest your savings in, although it will periodically inform you of the assets in which it invests them.
However, what if you don't agree with that? What if you want to manage your savings, that is, to be able to move them from one place to another looking for the best profitability? Well for that there is Unit Linked insurance:
The client assumes the investment risk and decides at all times where he wants to invest
Thus, unit-linked insurance is a product that offers you certain investment alternatives, up to a maximum of ten. The day you "enter", that is, when you make your first contribution, you decide how much of that contribution goes to each of the alternatives; you can put all your money in one, or distribute it between two, three, or more. You command.
Unit linked insurance is formed as an insurance in which you, the client, assume the risk of the investment. It is, therefore, an insurance that does not guarantee you any profitability but, in return, allows you to decide at all times about where you want to invest your savings. Insurance is at your command.
In fact, the normal thing is that you can change your mind whenever you want. You can, then, relocate the savings, take from here to put there, according to your criteria. Because, again, it's your criteria that rules.
Advantages of Unit Linked savings insurance
In addition to flexibility, Unit Linked units offer a number of additional advantages:
Advice. The insurance companies have the best professionals to help you select among all the investment alternatives the ones that best suit your preferences. That is, they are responsible for making a pre-selection.
No minimum contribution. Unit Linked units do not require initial or minimum contributions, allowing savings to be created with periodic contributions, even if they are small
additional coverage in the event of death, which may be higher or lower depending on your family situation.
Additional coverage for death. They are life insurance, so they give you
Is unit-linked successful in Spain? At the end of 2018, they had 700,000 clients, a figure in which savers who have combined it with an individual systematic savings plan (which are 1,700,000 as a whole) are not being calculated. The unit-linked already manages savings of more than 13,000 million euros. Every hour of the year, this insurance pays almost 420,000 euros to its clients who have decided to recover their savings
Possibility of combining with other products. They can be combined with other life insurance with tax benefits such as individual systematic savings plans (PIAS). In this case, if you collect them in the form of a life annuity, you will not be taxed on the income generated by your savings.
One more alternative, then, that can be very interesting for you if you have a saver profile that adapts to your possibilities.
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