NN Lifelong Income

Treat yourself to some interest regularly.

Have you built up some capital? If so, you can use it to take out an NN Lifelong Income policy, which will provide you with a lifetime annuity.

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How does it work?

  • You invest a single gross premium of a minimum of €50,000 in a life insurance fund.
  • The amount of the premium and your age at the time of joining the fund determine the guaranteed annuity that you receive
  • The guaranteed annuity is then paid out throughout your lifetime, whether you live to be 80 or 110.
  • You yourself choose the frequency at which your annuity is paid: monthly, every three months, half-yearly or annually.

 

Objective

NN Lifelong Income aims to generate a regular, guaranteed lifelong income for you by investing in the NN Life Global Managed Volatility Fund II. This insurance fund seeks to achieve growth by diversifying into various financial instruments, combined with a volatility target and a maximum investment of 60% in equities.The insurance fund invests in a single underlying investment fund: the BlackRock Global Managed Volatility Fund II. To achieve its investment target, the fund will invest in various instruments. The equity portion of the portfolio is invested in the shares of large caps all over the world. The fixed-rate portion of the portfolio is invested in eurozone government bonds and cash.

Who is it for?

When registering, the minimum age of the policyholder is 18, while the minimum age of the insured person is 50 and the maximum age 85. The policyholder’s usual place of residence must be in Belgium. The intended retail investor must have a minimum investable capital of €50,000 and want to benefit from a lifelong guaranteed supplementary income in the form of an annuity. There is no capital protection and the retail investor is prepared to bear that risk.

Who is it not for?

NN Lifelong Income is not subject to the regulations in the United States of America (USA) on the trading of securities; nor does it come under the supervision of the US financial regulator, the Securities and Exchange Commission (SEC).  For this reason, transactions linked with investment funds (known as Branch 23 products and covers) are not suitable or intended for persons who may qualify in the broad sense as a “US Person”. Click here for information.

NN Lifelong Income in a concrete way ...

Calculations based on
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1Calculation assumptions

Calculations are based upon a single gross premium, a tax on the premium of 2% and 2% entry costs.
The 2% entry costs used for the simulation may vary according to your contract. The entry costs are at least 0.5% and at most 3%. They include 0.5% entry costs for the insurance company and a maximum of 2.5% remuneration for your insurance intermediary.
Guaranteed annuity, except in case of partial or total withdrawal by the policyholder.
This simulation is not a contractual document. Consequently, the user can not derive any right or benefit from it. This information is provided for information purposes only.
Rates applicable on 01/10/2019
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BENEFITS

If the life insurance fund performs well, your annuity may rise

Each year, on the anniversary of the policy coming into effect, your annuity will be reviewed. If your reserve has risen, so will your annuity will rise.

The good news is that your annuity will not fall under any circumstances, except if you make a partial withdrawal.
Even if your reserve runs out, we will pay your annuity for life. NN offers you a guarantee on the annuity, for your whole life, but your capital is not guaranteed.
 

Your reserve is available at all times

The reserve of your NN Lifelong Income policy remains available to draw on at all times. However, if you unexpectedly wish to draw down on your reserve, you can do so under certain conditions.

  • You can withdraw the available reserve in full at any time
  • After 8 years, you can withdraw part of the available policy reserve, on condition that the withdrawal is for a minimum of € 2,500 and that a minimum of € 2,500 remains in the reserve after the withdrawal

 

In the event of your death, any reserve you have left over is not lost

When you die, payment of the annuity will cease. Your beneficiaries will then receive any remaining reserve from the policy. However, depending on how the fund has performed, the period during which the annuity was received and the deduction of costs, the policy reserve may have been reduced to zero.

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RISKS

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:

Solvency risk

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’.

Market risk

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.

Capital risk

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.

Volatility risk

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.

Specific risks

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.

Tax matters

  • You pay a tax of 2% on the premium paid.
  • Your initial annuity is not taxed. Only if the annuity is increased will the difference between the new annuity and the initial annuity by taxed, at 30% (plus municipal surcharges). The tax regime is comparable with that of admission into care or death.
  • In the event of death: in the event of the insured person dying, the taxable income corresponds with the positive difference between the available reserve from the policy at the time of death and the purchase price paid. This is after deduction of taxes, but before entry fees, less the untaxed portion of the guaranteed lifelong annuities already paid out by NN Insurance Belgium nv before the death occurred. The taxable income is taxed separately at 30% (plus municipal surcharges). NN Insurance Belgium nv will declare this income on tax form 281.40. The beneficiary in the event of death must include this income in his/her personal tax return. The general rules on inheritance tax apply.   
  • These rules apply in accordance with current tax legislation and are subject to change in the future. In the event of changes to the tax rules, NN Insurance Belgium nv cannot be held liable for the consequences. Tax treatment depends on the individual situation of the customer and may change in the future. Wherever reference is made to a tax system or regime, this needs to be understood as the tax system or regime that applies to an average retail customer living in Belgium in the capacity of a natural person (private individual).

Charges and premiums

Premiums

  • You pay a one-off premium of a minimum of € 50,000 gross, before deduction of charges and taxes
  • Married or cohabiting legally? In this case, 2 policies of a minimum of € 25,000 gross each before deduction of charges and taxes can be taken out
  • Have you as a policyholder taken out an NN Lifelong Income policy? In that case, the amount for the new policy will be a minimum of € 25,000 gross before deduction of charges and taxes

Charges

  • Entry fees: a minimum of 0.5% and a maximum of 3% on the one-off payment, after deduction of all applicable levies and taxes. These charges include a 0.5% fee for the company and a maximum payment of 2.5% for your insurance broker.
  • Cost of guaranteed lifelong annuity: 1.1% annually on the basic reserve.
  • Management fee of the life insurance fund: 1.09% annually on the reserve.
  • Management fee of the underlying investment fund: variable, but a maximum of 1.49% annually.
  • Withdrawal fee: This fee is not owed in the event of cancellation during the statutory cooling-off period of 30 days. The fee begins to apply after the cooling-off period ends and amounts to 4.80% at that time. After that, it reduces each month by 0.10% for the next 48 months.

More details: see the Essential Information Document and the Other Pre-Contractual Information Document.

Statutory information

  • Product: NN Lifelong Income is a life insurance product from NN Insurance Belgium nv, incorporated in Belgium under Belgian law. The yield from NN Lifelong Income is linked to a life insurance fund (Branch 23) and NN Insurance Belgium nv provides for the payment of a guaranteed lifelong annuity.
     
  • When registering, the minimum age of the policyholder is 18, while the minimum age of the insured person is 50 and the maximum age 85. The policyholder’s usual place of residence must be in Belgium. The intended retail investor must have a minimum investable capital of € 50,000 and want to benefit from a lifelong guaranteed supplementary income in the form of an annuity. There is no capital protection and the retail investor is prepared to bear that risk.
     
  • During the term of your policy, the capital is invested in a diversified Branch 23 life insurance fund (NN Life Global Managed Volatility Fund II) that constitutes your reserve. The aim of the life insurance fund itself is to realise gains by diversifying into various financial instruments, combined with a volatility target and a maximum investment of 60% in securities. The assets are invested in an underlying investment fund (BlackRock Global Managed Volatility Fund (managed by BlackRock)), which invests in shares worldwide and in European bonds. To protect the investor against major price variations during unstable periods, the fund manages the underlying securities in order to control volatility. For more details, please see the Management Regulations of the insurance fund. The net asset value of the insurance fund is determined weekly on the third bank business day of the week. NN Insurance Belgium nv publishes this information weekly on its website at www.nn.be/en/fundsoverview/nn.
     
  • Applicable law: Belgian law
     
  • Term: The policy is entered into for life and ends on the death of the insured person, or in the event of the early total withdrawal contract of the available reserve (on the initiative of the policyholder).
     
  • To find out more about the performance scenarios and the summary risk indicator (SRI), please see the Essential Information Document.


If you wish to lodge a complaint about your NN policy, please contact NN, Quality Team, 38 Fonsnylaan, 1060 Brussels. Send an e-mail in the first instance to klachten@nn.be. Otherwise, you can contact the Consumer Ombudsman Service of the Insurance Ombudsman at: 35 Square de Meeûs, 1000 Brussels. Tel: +32(0)2 547 58 71, fax +32(0)2 547 59 75, info@ombudsman.as, www.ombudsman.as. It is also always possible to institute legal proceedings.

Your unique life deserves a personal approach. That is why we are happy to help you find an independent broker in your area