Investment insurance is a financial product that, although called insurance, is more similar to banking models to make savings profitable. Its structure is practically the same, but with the difference that generates profitability which at the moment is more generous than that derived from bank term deposits. Because it is about tools that are designed to secure your money and also provide performance over the years. However, it is better to invest long term to obtain a higher return.
They are constituted as a savings model that can replace from now on the traditional financial products based on fixed income. For example, fixed-term deposits, bank promissory notes and, in some cases, also to high-income accounts. In any case, to hire them you do not have to go to the banking entities, but on the contrary they are marketed by the insurance companies. This is a substantial difference from the other investment models.
On the other hand, investment insurance is a product that in all cases offers a fixed profitability and guaranteed every year. It is not very high, but it allows you to gradually create a savings bag over the years. It is called investment insurance but it is also known as savings insurance because its foundation is to enhance this important aspect of the home economy over other technical considerations. It is not a homogeneous format but you can choose between different alternatives that Spanish insurers have designed.
Investment insurance: what is it like?
Investment or savings insurance are policies that guarantee a return associated with a capital that will be deposited during a previously established period of time. This initial capital and the profits obtained can be recovered at the precise moment in which this period of time ends. Where they are characterized because they allow the possibility that you can perform new contributions to the initial capital until the end of the established time. Depending on the savings you have in your checking account and the level of acceptance you have of this financial product.
Another aspect that you should take into account from now on is that which refers to your taxation. In this sense, they are more beneficial than the rest if they are aimed at the medium and long term. On the other hand, they are also more flexible, because you can design a savings or investment strategy at any stage of your personal or family life. In other words, it can be seen as part of child savings, retirement or even to achieve certain objectives. Like, for example, carpooling or planning the next summer vacation.
Profitability it offers
In any case, what most interests users at the moment is the remuneration they can obtain from now on. It is not defined in a unitary way, but the opposite will depend on the chosen model and especially on the insurer in charge of marketing it to its clients. Regardless, an overall return can be established for investment insurance that ranges from 2% to 5% approximately. Whatever happens in the financial markets since you will know your interest at the same time you subscribe these products intended for investment.
There is a subtle difference with respect to term bank deposits and that is that in these products the interest can collect it year after year. Without having to wait for the expiration date to arrive and that it can create some other liquidity problem in your checking account. This is one of the great advantages provided by this kind of insurance, so atypical and at the same time special. In any case, with a somewhat better profitability than in banking products and that has made them more attractive to a good number of users. Because in addition they always guarantee the monetary contributions made up to that moment.
Benefits in your hiring
Of course, one of the advantages of this insurance is that, if you keep your savings During the minimum time established by law (5 years from the first contribution), the returns you obtain are exempt from taxation. This is a very interesting aspect if you want to maintain greater tax savings from the next few years, regardless of the profitability that these financial products generate for you. Just as it allows you to opt for mixed life insurance with the purpose of saving as a strategy to make your personal assets profitable from now on.
On the other hand, you cannot forget that the guaranteed capital will be, at least, 85% of the premiums contributed. Where it will generally be from the fifth year of the investment where you are in a position to recover the total investment, that is, 100% of it. With only one condition and that is that you comply with the contracting regulations, which are very easy to complete. By limiting yourself to your hiring age being between 18 and 65 years old. Without at any time there is a link between the product and the equity markets.
Bailouts in savings insurance
It is a product in which you can perform punctual and partial rescues when you need some liquidity in your savings account. But how can you materialize this operation? Well, we are going to explain it to you in a simple way so that you can understand it from now on. It is based on a system in which you can withdraw money from the first stay. Generally with maximum limits of 15% during the next 2 or 3 years and later lower them to 1%. It is a flexible model in this regard that can satisfy your desire to anticipate complex situations when you are going to need money.
On the other hand, there is also the fact that the reimbursement, redemption or the early return part or all of the principal invested are subject to commissions or penalties. Although it is also true that it is an investment model that is intended for longer periods of permanence. Not surprisingly, it is considered a tool to create a more stable savings bag in the long term. Never for very short periods as on the other hand it can happen in term bank deposits. This is another difference to take into account from now on.
Commissions of these insurances
It is no less important to know that these financial products are fundamentally characterized because the guaranteed capital is only at maturity and the mobilization or exercise of the right of redemption implies a penalty that can cause losses. Outside of this incidence, savings or investment insurance do not have commissions or other expenses in its management or maintenance. In this way, you will be saving more money compared to other financial models in which rates of up to 3% are contemplated when carrying out operations and that may limit the possible benefits that you obtain from now on.
From this general scenario, investment insurance can be most beneficial to defend your personal interests, even if they are more unknown among Spanish users. Not surprisingly, their recruitment is currently below that carried out by investors in the classic banking products aimed at savings and investment. It will be a matter of analyzing both models to determine which is the one that you should hire at this time, depending on the profile you present.
With increasing annual interest
A novelty that investment insurance provides is that in some models the profitability may be increasing. This in practice means that they go increasing year after year. They start from a guaranteed technical interest of just over 1% per year, which is what you will receive during the first one. From this moment on, gradually increasing it, although without very striking deviations of any kind. So that in the end you get a return that can be very close to 3%, 4% or 5%. As is happening at the moment with some term deposits that maintain these same commercial constants.
Finally, it should be mentioned that these financial products have been constituted as a real alternative to banking models. With a tremendous struggle to capture customer savings and that leads their issuing entities to develop very aggressive offers and promotions from the beginning. Where in the end you can benefit from the best conditions in your hiring. Beyond other considerations of a technical nature that determine the peculiar structure of this financial product.
In any case, it will be another option you have to make the savings profitable in a safe way and with a minimum return on your financial contributions. At a time when the price of money is at its lowest levels in history, at 0%. a level that will pass history.