1979, California life insurance company introduced the first universal insurance, which was originally based on the flexible premium annuity, and added a monthly renewal term life insurance. In 2000, Pacific Life Insurance was the first universal insurance in the mainland market.
The operating principle of universal insurance is that the premium paid by the insured is divided into two accounts, one is the risk account for death compensation and the other is the universal account for investment. The money in the universal account can be added, surrendered and offset against the premium of the risk account, and a handling fee will be charged when it is added and collected.
Universal insurance has the following three characteristics:
1. High transparency: According to the Administrative Measures for Information Disclosure of New Life Insurance Products, the universal insurance information disclosure methods include but are not limited to: the website of the media company; Product introduction; Sales staff; Customer service staff; Send it regularly. The product manual should have tables showing: on-time payment, wholesale payment premium, additional premium and accumulated premium; Collect various fees; The value of the policy account; Publish the account balance, death payment and cash value under different assumed interest rates every month.
2. Flexible function: flexible payment, adjustable insurance amount, convenient collection of account value, unlimited collection times, but limited collection amount.
3. Guaranteed minimum income: at present, it is between 1.75%-3%, most head companies such as Ping An are between 1.75%-2%, and small and medium-sized companies are between 2.5%-3%. The minimum guaranteed interest rate in universal insurance is only for the funds in the investment account, not for all premiums.
Product form of universal insurance
1) universal account
Insurance companies set up universal accounts for universal insurance. It can be a separate account or a part of the company's total account.
The use of universal insurance funds is limited to: bank deposits, trading bonds, stocks and securities investment funds; Investing in real estate; Other ways of using funds as stipulated by the State Council.
Different universal products can use different settlement interest rates and minimum guaranteed interest rates, so the settlement interest rates presented by insurance companies may be different from what we actually buy.
2) Insurance liability: major death can be supplemented by serious illness, accident, hospitalization and premium exemption.
3) Insurance amount:
The insurance amount is divided into death insurance amount and survival insurance amount.
There are two ways to determine the amount of death insurance:
Mode A: the amount of death payment is fixed, and the amount of death risk insurance is adjusted every period to balance the amount of death risk insurance plus the account value;
Mode B: Death Payment Amount = Death Insurance Amount+Account Value.
Survival insurance amount = account value
The amount of universal insurance can be adjusted, but there is a minimum and maximum adjustment range.
Insurance premium payment
Premium payment is more flexible, similar to fund account. You can pay more or less if you have more money, but there are minimum and maximum restrictions.
Continuous bonus, in order to guide customers to pay on schedule according to actuarial design model, insurance companies will continue to pay design dividends to customers. Generally, after 5 years of accumulated payment, a certain proportion of the current premium will be paid, generally not higher than 2%.
expense
Universal insurance access is flexible, but there is a price, that is, access fees will be charged.
1) initial cost: the maximum is not more than 5%, and it usually decreases from 5%, 4%, 3%, 2% and 1% in the first five years.
2) Death risk insurance premium: Because the insurance company has to bear the death protection, it will charge a certain risk premium from the premium paid.
3) Policy management fee: a fixed amount unrelated to the investment value is not charged according to the proportion of the investment account value (such as monthly 8 yuan).
4) Handling fee: 1-2% will be charged in proportion to the account value when it is transferred out of the account or partially withdrawn.
5) Surrender premium: Surrender premium will be charged if you surrender midway.