Co-founder of Affari Miei Independent Financial Advisory Company
October 11, 2023
You are looking for information on Credemvita Life Plan Private why was it proposed to you by your consultant or are you interested in investments and came across this tool?
Today we will analyze all of them together characteristics of this policy, come on costs ai returnsup to the investment method, and at the end of the article you will find mine opinions about.
Enjoy the reading!
This article talks about:
Two words about Credemvita
Credemvita is active in the life and pension sectors. It operates only and exclusively through the distribution networks of CREDEM group.
The CREDEM group was founded in 1910, so it has a very long and successful history. It is one of the main Italian private companies; it is a modern bank and is currently present in 19 regions. Its diffusion occurred both through the opening of new branches and through the acquisition of small and medium-sized banks.
The bank combines technological innovation with the individual needs of customers. The bank is also attentive to the financial and living well-being of its people, suppliers, the community and also the environment in which it operates.
Precisely following these principles, in 2020 the new positioning that encompasses all this is launched, namely the Wellbanking.
What is a separate account and what does it invest in?
Credemvita Life Plan Private is a life insurance that invests in the separate Credemvita II management and guarantees the preservation of the invested capital in the event that the insured passes away.
The separate management allows you to “stay safe”. In fact, by investing in a similar product you will run limited risks, and you will be able to obtain certain returns, or at least more certain than those you would obtain if you chose to invest in the financial market by focusing for example on a unit linked product.
On the flip side, because we also have to analyze the “disadvantages”, is that by choosing a similar product you won’t be able to expect exciting returns, but this is normal and you have to take it into account. “Nothing ventured nothing gained” they say, and the saying is more valid than ever.
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Credemvita Life Plan Private: the characteristics
It is a product designed for those who are looking for safe returns and at the same time want to protect themselves.
The contract provides revaluable performancelinked to the results of a separate management that is held by the company I mentioned previously.
The company undertakes to pay to beneficiary an insurance benefit in the event of the death of the insured, and this benefit is equal to the revalued insured capital up to the date on which the company received the news of the death of the insured.
Payment of the premium
Credemvita Life Plan Private requires the payment of a unique prizewith the possibility of also being able to make additional payments subsequently.
As regards the single premium, the payment must be at least €300,000, while i additional prizes they can have a minimum amount of €25,000. This is a demanding solution, because in any case the amount that needs to be paid is not for all budgets.
Who is the tool aimed at?
The product is aimed at those who are resident in Italy and who intend to conserve over a time horizon of half periodthe capital invested in the event of the death of the insured, or in the event of redemption.
Investors must have at least a basic level of knowledge of insurance investment products, with a low risk tolerance and a low ability to bear losses.
The risk
The risk profile for Credemvita Life Plan Private is 2on a scale ranging from 1 to 7.
The risk of 2 is classified as a low riskprecisely on the basis of the instruments in which it invests.
The risk indicator assumes that the product will be held for 5 yearsand in any case the actual risk may vary in case of disinvestment at an early stage, and the sum reimbursed could even be lower.
Costs
This is one of the most important parts that you need to consider when thinking about and deciding whether or not to invest in this policy.
I costs they are the ones that impact returns, and therefore I advise you to consider them and read the carefully KID.
The composition of costs allows you to have an overview of their impact on your performance per year.
In this case the product has no entry costs and no exit costs, so we can say that this is a positive thing because similar policies often already have significant entry costs.
I management costs they amount to 1.20%, and refers to the cost you have to bear for the manager to take care of your investments.
Revocation and withdrawal
You can revoke the proposal until the contract is concluded.
In the event of revocation, the company will reimburse the policyholder for any premium paid within thirty days from the date on which the revocation request was received by the company.
For what concern withdrawal instead, within 30 days from when you received notification that the contract is concluded, you will be able to receive a refund equal to the amount of the premiums paid.
Resolution
It is not foreseen, in fact you will not be able to terminate the contract by suspending payments.
The ransom
You can also request the total or partial redemption.
However, remember that to request the ransom there are some limits to be respected:
At least one year must have passed from the effective date of the contract; In the case of partial redemption, the insured capital must be at least €300,000.
If you were to ask for redemption, know that the company will pay you the value of the contract equal to the revalued insured capital up to the date of receipt of the redemption request by the company.
It is important to know that the ransom includes some costs.
One is applied redemption penalty equal to a percentage of the amount of the redemption value, determined by applying the rates that I will now illustrate:
If 1 year and up to 2 years have passed from the effective date of the contract: 1.75%; If more than 2 years have passed and up to 3 years from the effective date of the contract: 1.25%; If more than 3 years and up to 4 years have passed from the effective date of the contract: 0.75%; If more than 4 years have passed from the effective date of the contract: 0%.
The tax regime
The premiums paid are exempt from insurance tax.
The sums paid by the company in the event of the death of the insured are exempt from IRPEF and also from inheritance tax.
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Affari Miei’s opinions on Credemvita Life Plan Private
Now that we have seen all the together characteristics of the contract, I can tell you mine opinions.
I’ll start by saying that what I’m going to tell you is a general discussion, as I don’t know you and I don’t know your personal and financial situation, so I’ll try to convey to you what I think and what I deem most appropriate for a possible investment.
The policy, as we have seen, invests in separate managementtherefore it is a safe investment, which does not promise exciting returns, but which still manages to guarantee you a certain security thanks to the low risk profile.
This is the first thing we have to choose: are you looking for a safe investment? Then this policy might be right for you.
Are you looking for an investment that can get you more interesting returns? Then maybe it’s best for you to take a look at other products.
About that I invite you to consult this guide.
As regards the product itself, I have to be honest, I’m not a big fan of investing in insurance, because I don’t consider it very convenient for an investor.
I think that policies are complex contracts, with many constraints inside and with different intentions: they want to protect you, but at the same time they promise you investments.
This way you are doing two completely different things with the same product. It’s almost never a good choice.
Furthermore, this contract is aimed at investors who have a certain amount of money available, since the minimum investment is high: it is not certain that you can or want to put all that money on a single product.
If you are interested in the protection you might think about relying on a simple one temporary death policy.
If you want to invest, here on the blog you will find many useful resources, such as the guides that I am leaving you now and which you will need to start your investment journey:
Happy reading and good investments!
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