You are guaranteed an annuity, but your capital is not guaranteed. You need to take these risks into account:
The main risks of the insurance fund, which are borne in full by the policyholder:
Life insurance policies are the subject of special assets that are managed separately within the insurer’s assets. In the event of the insurer going bankrupt, those assets are allocated first and foremost to meeting the insurer’s commitments vis-à-vis the policyholders and/or beneficiaries. Should NN Insurance Belgium nv default on payments or go bankrupt, payment of the annuity may be halted and return of the available policy reserve becomes uncertain. NN Lifelong Income does not benefit from the ‘Special protection fund for deposits and life insurance’.
A general risk exists for all types of investment. Movements in the price of transferable securities are determined mainly by developments in the financial markets and the economic performance of the issuers, which themselves are affected by the overall state of the global economy, as well as by the economic and political circumstances in their own country.
All financial investments comprise an element of risk. For this reason, the value of the investments and the revenue from those investments will vary and so the amount of the initial investment cannot be guaranteed.
Exchange rate risk
Changes in the exchange rates between currencies may result in the value of investments rising or falling. Fluctuations may be particularly pronounced in cases where a fund with higher volatility and the value of an investment may fall suddenly and significantly. Tax rates and tax bases may also vary from time to time.
There is no guarantee that the fund will perform to expectation and remain within the volatility tolerances indicated. The fact that the fund remains within the volatility tolerances indicated does not guarantee a positive performance. Volatility management can reduce the effect of a fall in market prices, but also mitigate the effect of rises in market prices. When markets are volatile, management of that volatility within the tolerances will require the fund’s allocation of assets being changed more often than usual. The transaction costs required to bring these changes about will be borne by the fund and this may have an effect on returns.
Financial markets, counterparties and service providers: the insolvency of institutions providing services such as the custody of assets or acting as a counterparty for derivative or other instruments, may expose the fund to financial losses.
Discuss with your broker what your investor profile is. This is essential for investing wisely.