Back in the Soviet Union, such a service as cumulative life insurance was widespread. The union collapsed, but the system remained, although it underwent some changes. What is an insurance system today? What is the essence of the funded program? And what do people who managed to take part in it say about this service?
What are the features of a funded insurance system?
Unlike a standard life insurance policy, a funded insurance system is a mix between the two programs. But, unlike the classic insurance policy, cumulative life insurance allows you to accumulate a certain amount of remuneration, which can then be used to achieve your own goals. This is a kind of bank deposit with the ability to accumulate interest.
What does the system of endowment insurance look like in practice?
The accumulative type of insurance provides for the following registration procedure. At first interested party comes to the insurance company. Then it signs a service contract for a period of 5–25 years and monthly deposits a certain amount, called a contribution, into the account of the company. Upon expiration insurance policy the insured person may receive an additional incentive amount in the form of accrued interest.
What opportunities does the funded system offer?
Accumulative insurance system is a unique financial service that enables insured persons to carry out the following actions:
- at the expense of savings, to collect the necessary amount for a certain solemn or important moment (for example, it may be your wedding, the birth of a child);
- provide financial protection to all members of your family and protect them from all types of accidents;
- learn how to distribute money within the family budget.
In addition, cumulative life insurance will help you realize your dream of acquiring a family car and apartment, buying a summer cottage and a country house. Also, due to the accumulated interest, you can raise funds for your children to enter a higher educational institution, etc.
How is the storage system different from the standard?
The insurance system can be conditionally divided into two large subspecies:
- risk insurance;
- cumulative life insurance.
Risk insurance involves a one-time payment by the insured person of a specified amount of the contribution in order to provide some protection for his life from diverse accidents. Moreover, if an insured event occurs with a person during the term of the policy, then he has the right to count on an impressive amount of compensation. If the case specified in the contract does not occur, then this person must either extend the agreement or refuse further cooperation with the company. And of course, if such a case does not occur, the amount you previously paid remains with the company.
Cumulative insurance program life, in turn, provides insurance for both the life and health of a particular person. Moreover, the first part of the money deposited by the client goes precisely to risks to life and health, and the second part of the amount goes to his account with the aim of further accumulating interest on it. Moreover, if the insured event does not occur, you are guaranteed to receive a certain amount of money, which during the entire term of the policy was lying and accumulated in your account.
Where can I get a policy?
The policy can be issued at insurance companies, banks and intermediary organizations. For example, Rosgosstrakh offers accumulative life insurance.In this case, this organization offers four main programs:
- "Family" ("Prestige").
- "Children" ("Prestige").
- "Savings" ("Prestige").
- "Prestige 2".
Family program: what is it?
Rosgosstrakh accumulative life insurance allows each family to realize their goals and at the same time protect the lives and health of themselves and their loved ones. How is this implemented in practice? Suppose you have issued this policy for a period of not more than 10 years and invested 1,000,000 rubles in it. Further, while your contract is in effect, you need to deposit approximately 8,781 rubles on a monthly basis. And if after contract duration an insured event does not occur, Rosgosstrakh pays you bonus compensation in the amount of 1 202 022 rubles.
What is the Children program?
Rosgosstrakh also offers funded life insurance under the Children program. It provides not only life insurance for your children, but also the opportunity to save money for their education, for buying an apartment, for a wedding, etc.
Suppose your child is five years old and you decide to draw up a policy for his name in the amount of 900,000 rubles for up to 13 years. According to the terms of the contract, you must pay about 5,882 rubles monthly to the account of the insurance company. As a result, your child will receive 1,150,000 rubles from the company for his 18 years.
What is the Savings program?
At Rosgosstrakh you can apply for a life insurance policy under the Savings program. The duration of such an agreement is determined individually and can be from 5 to 40 years. It provides for the choice of the insured person to make insurance contributions at a time, quarterly or monthly, annually or once every six months.
Under the program, people aged 18 to 70 can become a client of an insurance company. The program, like the two previous ones, makes it possible to accumulate the necessary amount for large acquisitions and purchases.
Prestige 2 insurance program: what is it?
The Prestige 2 program provides for cumulative life insurance (the rating of this program can be found by studying numerous user reviews). What does she offer? Firstly, it provides an opportunity to insure yourself and family members from all sorts of accidents, including industrial injuries and resulting from natural disasters. Secondly, the program allows the injured party (due to an insured event) to undergo qualified treatment in partner clinics. Thirdly, the company's policy provides a chance to receive qualified technical assistance on the road, legal advice, assistance from a dispatch center.
In addition, the program provides an opportunity for Rosgosstrakh customers to receive a credit card from Rosgosstrakh Bank with a credit limit of up to 300,000 rubles and a grace period of up to 50 days. Also, the policy is relevant for families traveling abroad, and for corporate clients. The sum insured for this policy will be 30,000 euros. The amount for the monthly payment of insurance premiums is only 250 euros, and the cumulative compensation amount is approximately 45,000 euros.
This is what Rosgosstrakh offers cumulative life insurance. Reviews about the programs and about the company itself can be studied below.
What are the positive and negative aspects of these programs?
The accumulative life insurance contract under the Family program has its positive and negative aspects. From the positive:
- you receive money regardless of whether an insured event has occurred or not;
- in addition to money, you insure the health and life of your family;
- every month you receive information about the accumulated interest amount;
- received money can be spent for the benefit of the family;
- You can take advantage of additional services from partner companies of the insurer.
Of the negative points, we can distinguish:
- the presence of monthly insurance premiums;
- dependence of the accumulation system on the state of the financial market and successful investment activities of the company.
Insurance from Sberbank of Russia
Sberbank of Russia offers accumulative life insurance for everyone. This program applies to Sberbank First and Sberbank Premier customers. It allows its participants to accumulate a certain amount for a child’s education or a large purchase, an entrance fee for a housing loan, etc.
Also, system participants can use other privileges when contacting with other banking products. For example, the bank’s customers are waiting for a reduced refinancing rate from the Central Bank and personal income tax rate, as well as the opportunity to formulate their own Reserve capital due to interest savings.
What is the principle of operation of the Sberbank program?
When choosing a program of insurance savings from Sberbank, you can determine the necessary amount for calculating interest, terms and frequency for paying insurance deposits. We give an example of calculation for this program. Suppose you have signed an agreement with a bank for up to 18 years. The size of the annual insurance premium will be only 250,000 rubles for you. After the expiration of the policy, you will be able to accumulate up to 6 906 425 rubles.
An example of the second. Suppose you have a three-year-old son for whom you plan to earn $ 100,000 by participating in the insurance program. In addition, you want to insure yourself against getting injured at work (the sum insured is $ 25,000) and from contracting a fatal illness (the amount of insurance is $ 30,000). At the same time, you plan to accumulate the above amount of money until the moment when your son is 15 years old. The size of the quarterly contribution will be equal - $ 1,758. In addition, in order to reduce your own costs, you can use the service “Tax exemption”.
Suppose, after some time from the moment of signing the contract, you stumble at work and get a fracture. The insurance company reimburses you $ 2,500. If after a couple of years you have a heart attack, the amount of compensation in this case will be $ 30,000. So, at the end of the contract, your son receives an amount of $ 115,269. You get $ 67,660, of which it is worth subtracting the cost of insurance compensation after an injury, treatment after a heart attack and for using the service "Exemption from Contributions" in the amount of 35,160 (in just 5 years).
Endowment life insurance: reviews
As can be seen from the examples, the accumulation of interest is a good thing. However, it also has its pitfalls. In order to learn about them, you need to carefully study the reviews of all users who have ever issued an insurance policy with a funded system. For example, some of them respond positively to the insurance companies they have contacted. They claim that they were glad to cooperate. And although they did not return the invested money, but they managed to accumulate the necessary amount for the purchase of housing.
The second claim that they are satisfied with the program, because during the term of the contract they not only accumulated a suitable amount for the purchase of a car, but also used the payment of treatment when they were injured at the workplace.
Recall that Rosgosstrakh offers accumulative life insurance. Reviews about this company are the most controversial. Some people like it, but some don't. In a word, weigh the pros and cons and decide for yourself whether it is worth concluding an agreement with the insurer for the insurance savings program.
