Independent Financial Advisor and Co-Founder of Affari Miei
February 29, 2024
If you are interested in investments and you’ve heard of insurance you’ve probably come across Zurich Targetthe class policy I designed for those who intend to invest their savings over a long time horizon.
In this article you will find all the information about this product, you will see its characteristicshis costsi advantages they disadvantagesand at the end of the article you will also find mine opinions about.
Let’s start!
This article talks about:
Who is Zurich
Il Gruppo Zurich it has been present in Italy since 1902 and can count on over 1,000 collaborators; operates through a network of approximately 550 agencies, brokers, financial advisors, banks and also uses Zurich Connectan online and telephone channel.
They are responsible for offering solutions designed to respond to insurance needs both in the area of protection, savings but also social security.
The group has around 1.8 million customers and aims to broaden the customer base even further.
Zurich’s objective is to listen to people and companies, delve deeper into their needs and try to offer an increasingly better service.
What is a Class I policy?
Zurich Target is classified as one class policy I: it is a policy that links the return on capital to a relatively safe investment.
The investment is safe as your money and savings will be invested in one separate managementa form of investment management that is separated from other activities and invests mainly in bonds, capable of offering greater stability from a security point of view.
If you are interested in learning more I leave you this resource that may be useful to you to understand even better how the product you will probably choose works.
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The characteristics of Zurich Target
Zurich Target is an insurance which provides benefits in the event of the insured’s survival upon expiry of the contract and also benefits in the event of the insured’s death during the contractual term.
As we have seen, investment results are related to separate managementin this case it is Zurich Trend.
To find out more about this management I recommend you go to the official Zurich website and learn more.
The product is designed for those who wish to invest part of their investments with a long time horizon.
Payment of the premium
Il payment of the premium it must be made in a single payment, either by non-transferable check or by bank transfer or by debit or credit card. It is not possible to pay the premium in cash.
Payment and payment of a fee is expected unique prizewith a minimum amount of €5,000 and a maximum of €500,000.
To the duration
The duration of the product can be chosen by the customer; it is based on your needs and is equal to 10 or 20 years.
Zurich Target offers the certainty upon expiry of the contract or in the event of death of obtaining the repayment of at least the premium paid, and at most the capital revalued on the basis of the returns obtained annually by the separate Zurich Trend management.
Who is the product aimed at?
Zurich Target is aimed at customers who have overall assets to meet their liquidity needs and which they undertake to maintain at least for 10 years the investment: this is why we talk about a long time horizon.
The contract can be signed by natural persons, and furthermore the insured can be between 18 and 89 years old.
Risk profile
Il risk profile of this product is low, we are up 2 on a scale ranging from 1 to 7.
The level of risk is in fact related to the relative safety of the separate management, and to the fact that upon expiry of the contract or in the event of death you have the right to a refund of at least 100% of the premium paid.
Costs
Given that the recommended period of time to hold the investment is 10 years, let’s now see what they are costs which will be incurred and which will inevitably impact your returns.
I entry costs are those that must be incurred at the time of signing the contract. They are equal to 50 euros for prizes under €20,000 and are deducted from the premium paid.
I exit costs These are the costs to be incurred when you decide to exit the investment, but they are not applied if you hold the product for 10 years.
The management fees they are equal to 1.2% per year, and are in fact withheld every year from the return of the separate management. They refer to investment management and are those that remunerate the manager who takes care of your investment.
Revoke or withdraw
You can decide to revoke the proposal until the moment of conclusion of the contract, by sending a request to Zurich by registered letter or certified e-mail.
You can too withdraw from the contract by sending a communication by registered letter or certified e-mail within 30 days of the date of conclusion of the same. Withdrawal frees you from any obligation deriving from the contract, with effect from midnight on the day the request is sent.
The ransom
If at least 1 year has passed from the effective date of the contract and provided that the insured is still alive, then the policyholder can decide to request the partial redemption of the contract provided that the amount is at least €2,500 and the insured capital less the premiums relating to partial redemption is at least €2,500.
You can also request the total redemption of the contract and in that case the amount will be determined in this way: the redemption value will be the greater value between the updated capital and the premium paid net of the premiums relating to any partial redemptions.
However, the ransom makes you go towards redemption penaltywhich apply both in the case of total redemption and in the case of partial redemption.
Let’s see them in detail:
During the first year: redemption is not possible; In the second year: 4%; In the third year: 3%; In the fourth year: 2%; In the fifth year: 1%; From the sixth year onwards: 0%.
Returns
As we said, Zurich Target invests in separate management Zurich trend.
It invests mainly in government bonds and bonds and, only to a limited extent, in shares or mutual funds.
In the event that the return achieved by the separate management is less than 2.50% then the retained return will be decreased by 0.04% for every 0.10% decrease in the return of the separate management up to a minimum value of retained return equal to at 0.80%. If the yield is above 3.50% then the retained yield will be increased by 0.04% for every 0.10% increase in yield.
Tax treatment
We conclude our analysis with a look at the tax regime.
The premiums of life insurance contracts are exempt from insurance tax, while the benefits paid have a tax rate of 26%, which can be reduced in proportion to the part of the return attributable to government and equivalent securities, subject to ‘rate of 12.50%.
Furthermore, the capital paid upon the death of the insured is exempt from inheritance tax.
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Affari Miei’s opinions on Zurich Target
We finished ours analyses; I hope this article was helpful if you were looking for insights into the product Zurich Target and that you may have found all the features and costs relating to the policy here.
As we have seen the product invests in one separate managementso from a safety point of view we can only rest assured: if you are looking for a product that can offer you returns but without risking too much then you may have found what is right for you.
But are you sure it’s the only safe investment you can make?
About that I invite you to read this article where you will find many types of safe investmentsyou may find that there is a better solution for you!
If you are looking for investments but would like to try to obtain higher returns, then I recommend you consult this list where you can find many useful resources for you: with these you will be able to enter the world of investments and begin to take your first steps in a more conscious way.
As regards the insuranceare you really sure this is the right product?
In this video I talked about the investments in insurance and I tried to explain why, in my opinion, it is a not entirely profitable investment.
Before saying goodbye completely, I also want to leave you other resourceswhich will allow you to start your investment journey in the best possible way and above all to choose the path best suited to you:
Enjoy the reading!
Find out what kind of investor you are
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