Benefits of Segregated Funds

Segregated funds have unique features that make them different from mutual funds and they fall under the insurance act.

Lifetime income benefit option

There are new features on the market place for segregated investments that many people are moving towards. Consider perserving your retirement capital and income by guaranteeing your income for life. With the lifetime income benefit option, your income won’t decrease regardless of how the segregated funds perform unless excess withdrawals are taken. You get protection against the risk of outliving your money, market volatility and inflation.

Creditor Protection

Laws may protect a segregated fund policy in the event of bankruptcy or other action by creditors. It’s important to note that creditor protection may depend on court decisions concerning such laws, which can be subject to change and can vary for each province. This protection cannot be guaranteed.

Maturity guarantees

Segregated fund policies provide guarantees of either 75% or 100% of the premiums paid depending on the product selected. These guarantees allow you to plan more effectively for life events such as your retirement.

Death benefit guarantees

Segregated fund policies provide a principal guarantee in the event of death.  This death benefit guarantee is usually either 75% or 100% of the premiums paid (or policy value if you’ve locked in market gains with policy resets) less a proportional amount of redemptions, depending on the product selected.

Estate settlement

Segregated fund policies can help speed up estate settlement with protection for you and your family. If you name a beneficiary, the death benefit isn’t subject to the delays and expenses of the probate process. For non-registered policies (where the beneficiary is not the estate), several estate planning options are available to help organize future income payments for your beneficiary, in addition to the traditional option of a lump-sum payout.

Named beneficiary

You can choose one or more beneficiaries. These designations can be your estate, your children or other individuals, or associations such as charities.