BMO Nesbitt Burns
1959, 152 Street
White Rock, BC
What is a segregated fund?
segregated fund is an investment fund that you hold within an insurance
contract. The term "segregated” refers to the fact that your investment
is separated from the general assets of the insurance company. Your
insurance contract dictates the insurance protection you receive. So
segregated funds are an insurance contract that provides you investment
management plus protection.
Segregated Funds – Unique Advantages
Segregated funds are similar to mutual funds in many respects but provide a number of additional features and benefits.
Benefits Beyond Mutual Funds
Maturity, Death and Income Guarantees
on the contract, an investor can choose from a number of options that
guarantee a minimum of 75% of the total amount you paid to the contract
upon death or contract maturity*. Certain segregated funds, commonly
referred to Guaranteed Minimum Withdrawal Benefits, provide an income
guarantee either for a set period of time or life. There are numerous
combinations available with a wide variety of terms and conditions.
Potential Creditor Protection
is of primary concern for business owners or professionals as their
assets may be exposed to creditors. You may be able to achieve potential
creditor protection by naming a "preferred” or "irrevocable”
beneficiary. The key relationship is between the life insured (the
annuitant) and the beneficiary. Creditor protection is never guaranteed.
Segregated funds held in a brokerage account may not be afforded
creditor protection. It is recommended that you consult independent
Estate Planning Made Easy
of your contract are paid directly to your beneficiary, avoiding the
time and expense of probate. Also, probate is a public process and
information associated with it is accessible to the public. By helping
your heirs bypass probate, segregated funds can ensure that your
personal decisions and information remain the way they were meant to
funds are eligible for coverage by Assuris. This plan protects
Canadian policyholders, within limits, from loss of benefits in the
event of the insolvency of the company.