Independent Financial Advisor and Co-Founder of Affari Miei
December 12, 2023
If you’ve heard of Milan Intelligent Life Plan because you are looking for one policy to invest then perhaps it is the right time to get the best information and discover all its features, focusing on the costs, advantages and disadvantages of the instrument in question.
Today we will analyze this together unit linked policy and at the end of the article you will also find mine opinions about.
Let’s start!
This article talks about:
A few words about Banca Mediolanum
Let’s start with a brief presentation of the bank offering the policy.
Banca Medionalum is a direct bank offering banking, investment, credit and insurance services, based in Basiglio, near Milan.
It is also the parent company of the Medionalum Banking Group, which controls the product companies in the three business sectors which are banking, managed savings and insurance.
The company is listed on the FTSE MIB index of the Milan Stock Exchange.
It is a multi-channel bank that operates through a commercial network made up of approximately 4300 financial advisors.
The main values of Banca Mediolanum are freedom, relationships and responsibility.
Furthermore, the bank believes in constant improvement and focuses heavily on sustainable innovation, developing innovative solutions to encourage sustainable behavior in the interest of the community.
If you want to learn more, here you will find an overview of all the investments proposed by Mediolanum bank.
What does “unit linked” mean?
Intelligent Life Plan it is a type policy unit linked: it is a policy whose return is linked to the performance of units of funds internal to the issuing company, or of external funds such as collective investment undertakings (OICR).
A policy of this type is not considered a safe investment, because it invests in instruments that are not safe in themselves.
In fact, a unit linked policy differs from one class policy I which invests in a separate management mainly due to the different level of risk they have.
A policy of this type allows you to invest in the financial markets: it is a good solution if you are looking for greater returns, but be careful because on the other hand it could make you run greater risks than separate management.
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Features of Mediolanum Intelligent Life Plan
This unit linked policy (or branch III) is a life insurance contract which is characterized as an insurance investment product which aims to invest in one or more internal funds or UCIs made up of Life of Milan SpA. and, at the same time, to offer coverage in the event of the insured’s death.
It’s for you if you are looking for a product that allows you to plan your future and build it with peace of mind, combining the possibility of seeing your savings grow with protection.
The performances
Let’s see what they are performance which are foreseen upon signing the contract:
Service linked to the assets contained in internal funds: the premium you choose to pay will be invested based on your risk appetite and your return expectations in one or more funds made available by the company.;
Death benefit: in the event that the insured were to die, the capital payable to the beneficiaries will be equal to 101% of the greater between the total gross premiums paid on the date of reporting the fact and the total value of the fund shares, if the insured has less of 75 years, while it will be equal to 101% of the total value of the fund units if the insured is over 75 years old.
Then there are further benefits such as switchwhich consists in the possibility of changing the distribution of the investment between the funds at any time and the conversion into an annuity after 10 years from the start of the contract.
The prize
You can choose whether to opt for payment with a unique prizewith a PIC programmed or with a scheduled rewards plan.
If you sign the contract with a single premium or with a scheduled PIC then the amount of the premium must be at least €15,000, with a minimum payment for each single chosen fund of €2,500.
If, however, you choose to pay a single premium by joining a scheduled PIC, then you will have to pay at least €10,000 via a scheduled PIC.
You can later choose to pay additional prizes through a single premium (the amount of which must be at least €2,500 for an unvalued fund and €500 for each fund in which part of the capital is already invested), or you can make any payments with a scheduled PIC and in this case they must be at least €10,000 with a minimum premium of €2,500 for each unvalued fund and €500 for each fund in which part of the capital is already invested at the time of the operation.
To the duration
The contract has a duration which coincides with the life of the insured and expires either in the event of the death of the insured, or in the event of a request for total redemption by the policyholder or in the event of cancellation of the number of units attributed to the contact also deriving from the payment of the stamp duty based on current tax provisions.
Who is it aimed at?
This product is aimed at customers who do not require a capital guarantee: it could in fact suffer even greater losses, depending on the market trend.
The client to whom the contract is addressed should have at least average knowledge of investment matters, or experience in similar products.
You can think about this product if you want to match the possibility of growth of savings to protectionat the moment of the generational transition and in the foreseen cases, of the capital invested in favor of the people closest to you.
The funds linked to the contract
What funds does the product invest in?
It is good to know that they can be linked to the contract three different internal funds:
Global Perspective;
Global Discovery;
Global Thematic Focus.
You can also choose to invest the entire premium or part of it in the internal Easy Fund fund which can be combined exclusively with the “Intelligent Investment Strategy” program.
Costs
We now come to the most important part to consider when choosing an investment instrument.
For them issuing costs there are €20 to pay when signing the contract.
The subscription fees instead they vary based on the amount paid:
Monthly split: 2 euros; Bimonthly split: 3 euros; Quarterly split: 5 euros; Half-yearly split: 7 euros; Annual split: 10 euros.
I costs for the switch amount to €50, with the exception of the first operation which is carried out during the calendar year.
The annual management fee on internal funds however it is different, based on the internal fund chosen:
For the Global Perspective fund: 2.15%; For the Global Discovery fund: 2.15%; For the Global Thematic Focus fund: 2.15%; For the Easy Fund: 0.50%.
Revocation and withdrawal
The contract is concluded with the signing and delivery of the proposal form, therefore the possibility of revocation of the proposal and the right to change of mind can only be exercised through withdrawal.
Yes it can withdraw from the contract within 30 days from the moment the contract is concluded, by written communication to the company by registered letter.
The company will therefore be required to reimburse the premium paid net of fixed fees no later than 30 days from the moment it received the notice of withdrawal.
Ransom
After 6 months from the effective date of the contact, you will be able to request the total or partial redemption of the same, provided that the amount requested is not less than €2,500 and the residual value of the shares of each indicated fund is also not less than €2,500, assuming that the scheduled PIC is active on the same funds .
Furthermore, the total residual capital on the contract must be at least €5,000.
If total redemption is exercised, then the contract will be terminated without the policyholder having the right to reactivate it.
Tax treatment
Lastly we see the tax regime of the contract.
Life insurance premiums are exempt from state insurance taxes, while taxation on sums insured is 26%. The stamp duty applied is 0.20% proportionally on an annual basis, with no minimum threshold and no maximum limit.
The capital liquidated in the event of the insured’s death is exempt from inheritance taxes and does not form part of the inheritance.
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Affari Miei’s opinions on Mediolanum Intelligent Life Plan
We have reached the end of ours analyses on the product, so now we can reflect and reason together.
If you have had the opportunity to read other similar content here on Affari Miei you will most likely have understood that we are not huge supporters of this type of product.
Be careful because I won’t talk to you about this policy specifically, but about what unit linked policies and policies are insurance in general.
If you are interested in insurance, you must think that insurance should protect you from risks, and not think about getting invested.
In this case, in fact, you will have a product that assures you but at the same time combines the possibility of investing.
If you try to do two things, which are so different from each other, the results are often not the most positive.
First of all, a policy of this type presents itself as very complex, full of costs and hidden features, which you need to know how to find and interpret.
If you are interested in protecting yourself, you should turn your attention to a product that only deals with insurance, while if you want to invest, know that there are many other tools capable of carrying out this task.
If you want to learn more about insurance, read my review here.
If you are interested in investing profitably, you can take a look at this article.
If we stay in the world of investments and financial instruments, I think there are better solutions to turn to, such as ETFsa very useful tool that in my opinion could be right for you, and which, furthermore, being passively managed, is able to significantly lower management costs.
If you are an investor aware and you are able to withstand losses, you could also opt for this investment, although you must know that you risk a lot and above all you have few guarantees on returns: it all depends on you and what you are looking for, I can’t tell you what to do specifically .
In any case, the Institute in question has a very solid history behind it. It is a Group that offers security and professionalism, therefore, if you really feel that you want to delegate the management of any form of investment to an entity (without having to take care of it yourself because you don’t feel like it), then you will certainly be in good hands.
Before saying goodbye, I want to leave you these resources which may be useful to you:
Happy continuation on Affari Miei!
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