Co-founder of Affari Miei Independent Financial Advisory Company
23 August 2023
Are you looking for information about BPM Life Refugethe revaluable policy designed for those who want to benefit from investment results by seeing their capital grow over time but without taking too many risks?
If yes, then you are at the right place because today in this article we will analyze all of them characteristics and then we will try to draw some conclusions relating to its convenience; at the end of the article you will also find mine opinions about.
Enjoy the reading!
This article talks about:
A few words about BPM
As usual, before starting with the product analysis, I would like to illustrate theinstitute who proposes it.
It’s about BPMone of the most important players in the Italian bancassurance scene.
The group specializes in creating products suitable for the banking channel, and for this reason it makes its insurance solutions available to two territorial divisions of Banco BPM.
The product, specifically, is distributed by Banco BPM Vita S.p.Athe life company born in 1997 which deals precisely with insurance.
It is wholly controlled by Banco BPM SpA, the parent company, which is focused on offering quality products and services in the areas of savings, investment and personal protection.
Class I policies
BPM Vita Rifugio is one branch I policyor one of those policies that links the return on capital with a relatively safe investment given by a separate management.
In fact, your savings will be invested in separate management, i.e. a form of investment management that is effectively separated from other activities, and which invests above all in bonds. In this regard, it is a safe investment capable of guaranteeing capital security to the policyholder.
If you want to go deeper I leave you here a resource that may be useful to you.
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The characteristics of BPM Vita Rifugio
BPM Vita Rifugio is a mixed single-premium insurance, with participation in the financial results achieved by a separate management of assets.
The separate management in which the single premium you will pay is conferred is BPM Sicurgest, in which you will mainly find bond assets such as government and corporate debt securities, but you can also invest in equity securities, bank deposits, repurchase agreements and UCI units.
What are the performances?
The performance of the policy are two, of which one occurs in case of life of the insured and the other in case of death.
Let’s examine them in detail:
In case of life of the insured: upon expiry of the contract, the higher amount will be paid between the premium invested net of any partial redemptions and the insured capital adjusted to the expiry date;
In the event of the insured’s death: on expiry, the higher amount will be paid between the premium invested net of any partial redemptions and the insured capital adjusted to the date of death, determined on the basis of the extent of participation in the financial results achieved over time by the separately managed account.
The prize
The insurance provides for the payment of a single prizewith certain figures to be respected.
L’minimum amount of the prize must be €25,000, while themaximum amount must be equal to €400,000.
It is also not possible to pay a accumulation of prizes greater than €5,000,000 on contracts linked to BPM Sicurgets, or to the separate management, over the course of each calendar year.
To the duration
The contract has a fixed term of 5 years.
How is the contract terminated? It expires upon expiry, with the death of the insured or if the policyholder exercises the right of withdrawal or total surrender.
Who is the product for?
The product is aimed at a retail clientele, who has even basic knowledge, a low risk tolerance and who wishes to invest capital to preserve the same over a time horizon of not less than one year.
Risk level
As we have already mentioned several times, the risk level of this product is low: we are up 2 on a scale from 1 to 7. This therefore means that it is very unlikely that bad market conditions will affect Banco BPM Vita SpA’s ability to pay what is owed to you.
Costs
As for i costs that you will have to bear in relation to your investment, they are the part that you will have to consider most as they impact on your returns and consequently on your investment.
Let’s analyze them in detail:
Entrance costs: equal to 1.70% of the amount paid;
Exit costs: only apply if you leave before the recommended holding period;
Management fees: these are the costs withheld each year for investment management, and are equal to 1.30% of the value of the investment per year;
Transaction costs: are not applied;
Performance fees: are not applied for separate management.
Revocation and withdrawal
Before the completion of the contract, in the event that there are some things that are unclear or that do not convince you, you will be able revoke the proposal through a written communication to the company.
Within 30 days of receiving the communication, the company will then refund any sums already paid.
You will also withdraw from the contract within 30 days, by written communication to the company.
The ransom
Now let’s see the redemption.
It is also possible to request a ransom, which can be total or partial.
In case of total redemption, the surrender value is equal to the insured capital adequate to the financial results of the separately managed account; it is possible also requires the partial redemption to which the costs you find in the KID are applied.
Returns
As regards i returns of the separate management in which the contract invests, or BPM Sicurgest, we have a gross yield of 2.21% in 2022, with an average of gross yields over the last 5 years of 2.35%. However, I invite you to consult the file that you find on the official website for more information and a clearer idea of the situation.
Tax treatment
We conclude the discussion with a look at the tax regime.
The premiums of life insurance contracts are exempt from insurance tax, while instead the services paid have a 26% tax rate, which can be reduced in proportion to the part of the return attributable to government bonds and equivalents, which are instead subject to the rate of 12.50%.
Furthermore, the capital disbursed upon the death of the insured is exempt from tax successions.
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Opinions of Affari Miei on BPM Vita Rifugio
We have finished analyzing the product, and have seen all its features in detail.
So now we can move on to conclusionsand to try to understand if it is a useful product for you or not.
I begin by telling you that now I will not dwell on the product proposed by BPM in particular, but rather I will give you a general discussion on branch I policies.
As you will have understood, it is a relatively safe product, since it invests in a separate management with a fairly low risk (its risk profile is in fact equal to 2 on a scale ranging from 1 to 7).
If you’re looking for something risk-free you might be attracted by a similar product (whether it’s this one from BPM or another similar one), but on balance you have to wonder if you’re actually making the right choice.
Are you making the right choice by investing in a product that protects you and invests at the same time?
Isn’t it one of those products that wants to do too many things and then essentially does neither one nor the other to the maximum?
Because that’s often the case: when you want to do so many things, one of which is different from the other, often you can’t get the best out of both of them.
If you are interested in the investments I think you shouldn’t take this tool into consideration, but not because it’s not safe or because it’s not good, but rather because it’s a product that doesn’t best pursue the goal you’re looking for.
If you want to invest, you must be ready to take responsibility, which translates into the possibility of taking greater risks to obtain higher yields.
If you stop at these products, you will be able to invest in relatively safe tools but you will get little, and above all you will find yourself embroiled in an investment that is not entirely suitable for you and profitable.
Precisely in relation to investments I invite you to consult this list where you will find many useful resources for you, with which you can enter the world of investments and you can begin to take your first steps in this world.
Still in relation to investments, I personally want to give you another piece of advice: I invest my money using an instrument that has become increasingly popular in recent years, ETFs.
These are passively managed funds that allow you to diversify risk by investing in multiple companies with a single instrument.
If you want to know more, you can read this in-depth article.
If you’ve already had the opportunity to read my other content, perhaps you’ve come across my advice that I often repeat: formats!
I am a supporter of training as I truly believe it is the only useful and essential thing to obtain results in every field of life, without exception for that of investments.
Precisely for this reason, I leave you here with other resources that you may need to start your investment journeys:
Enjoy the reading!
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