Commercial Union Poland Life Insurance Company (CU Life) has introduced two capital insurances into its offer: a whole of life insurance Sure Future and an endowment policy Joy of Life.
Commercial Union Poland Life Insurance Company (CU Life) has introduced two capital insurances into its offer: a whole of life insurance Sure Future and an endowment policy Joy of Life. They add a new segment to the company’s current range of products. CU is working in parallel to increase its presence in the dynamically growing bancassurance sector, and has recently begun offering short-term term life insurance in cooperation with Deutsche Bank PBC in Poland.
Capital insurances, also called traditional insurances or endowments, differ in structure from unit-linked insurances. Primarily they guarantee the amount of insurance benefit, they envisage bonuses which increase its benefit level and they transfer the investment risk to CU. "In our view, offering endowments that are attractive to clients requires maturity of the market and stable, low inflation" said Zygmunt Kostkiewicz, CU Life deputy chief executive. Benefits from the two new insurances are exempt both from capital gains tax and from inheritance and donation tax.
Whole of life insurance Sure Future is primarily aimed at providing insurance protection in the event of death, and also at accumulating capital for heirs to pay estate tax and other costs linked to inheritance. Its aim is also to make it possible to pass on savings to beneficiaries without the need to pay estate tax or capital gains tax. The insurance always lasts until the end of the life of the insured person – so the premium may be paid, as the client decides, until the end of the 55th, 60th or 65th year of life. The insurance benefit and the premium are constant and not subject to indexation. There is also an available version with a single premium – in this case the insuring party pays once for insurance protection until the end of life of the insured person. In the event of the death of the insured party, the beneficiaries receive an insurance benefit and allocated bonuses (guaranteed and additional). In insurance with a regular premium, the client may also apply for an extension of cover through additional contracts: incapacity for work, premium insurance, guaranteed increase in insurance benefit, hospital cash benefit and accident insurance. Insurance may be utilised as an additional security for payment of credit and loans.
"Our intention is to make our clients and public opinion more aware of estate and donations tax. Our experience indicates that very many people are unaware of when this tax falls due and what a burden it may prove. It particularly affects those who inherit property from people to whom they are not related, and sometimes even means that an estate is rejected because of the impossibility of paying the tax. One way of avoiding it is a properly chosen endowment", said CU Life board member Anita Bogusz.
Endowment policy Joy of Life belongs to the category of pure endowments. When the contract is being concluded, the time at which it is to end is usually established – most commonly this is when occupational work usually winds down. The benefit (which is free of capital gains tax) may then become a source from which a capital annuity may be drawn (an additional, third-pillar pension).
"In highly-developed countries, especially the Anglo-Saxon ones, accumulation of capital in the form of endowment and then conclusion of an annuity contract that guarantees regular payments is a generally-accepted way of managing one’s personal finances", emphasises Zygmunt Kostkiewicz. Joy of Life insurance is concluded for a period of between 10 years (five years for a single premium) and 30 years. Versions with regular and single premiums are available. The insurance benefit and premium are fixed and not subject to indexation. In the event that the client lives to the end of the insurance period, the insured person receives the insurance benefit and allocated bonuses (guaranteed and additional). The purpose of the insurance is to build up capital, so the insurance cover in the event of death is reduced to a minimum.
In connection with the inclusion of endowments into its offer, CU Life has been running a special educational and promotional campaign addressed primarily at CU insurance sales agents and future clients. Presentation material has been prepared for this campaign and a cycle of training sessions have been organised to explain what the new insurances are about.
Commercial Union Poland Life Insurance Company has been the market leader in individual life insurances for more than ten years now and it comes second in the industry in terms of gross premiums written. In the first half of this year, CU Life took in 864.9 m Polish zloties (Ł146.6m) in gross premiums, achieving a net profit of 218.9 m zloties (Ł37m). The value of CU Life investments exceeds 9.1 bn zloties (Ł1.5bn).
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Information:
Tel + 48 22 557 43 41
E-mail: bohdan_bialorucki@cu.com.pl
For further information, see www.cu.com.pl
Notes to editors:
Commercial Union Poland Group is part of the international Aviva group, the world’s sixth largest insurance, savings and investments group, and the largest in the United Kingdom by revenues. Aviva group operates in over 25 countries. It occupies a strong position in the European Union, including United Kingdom, Ireland, France, the Netherlands, Spain, Italy and Poland. Worldwide, Aviva group services over 30 million customers and manages assets valued at over Ł290 billion. For additional information, see the website http://www.aviva.com.