Unitised insurance fund
Encyclopedia
Unitised insurance funds or unit-linked insurance funds are a form of collective investment
offered through life assurance policies.
An insurance company's contract may offer a choice of unit-linked funds to invest in. Insurers that offer these contracts are mainly found in the UK
and British Isles
offshore financial centre
s. All types of life assurance and insurers pension plans, both single premium and regular premium policies offer these funds. They facilitate access to wide range and types of assets for different types of investors.
The range of fund choice for investment has grown significantly in recent years with the increased trend to provide unit-linked alternatives to popular unit trust
and OEIC funds styled as externally managed funds as opposed to the life assurance companies internally managed funds. Typically the externally managed fund links have higher charges; this is tolerated as the expectation is for better returns.
This said, in practice life insurance companies tend to be well regulated and depend on their reputation which ensures consumer confidence when investing.
Collective investment scheme
A collective investment scheme is a way of investing money alongside other investors in order to benefit from the inherent advantages of working as part of a group...
offered through life assurance policies.
An insurance company's contract may offer a choice of unit-linked funds to invest in. Insurers that offer these contracts are mainly found in the UK
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
and British Isles
British Isles
The British Isles are a group of islands off the northwest coast of continental Europe that include the islands of Great Britain and Ireland and over six thousand smaller isles. There are two sovereign states located on the islands: the United Kingdom of Great Britain and Northern Ireland and...
offshore financial centre
Offshore financial centre
An offshore financial centre , though not precisely defined, is usually a small, low-tax jurisdiction specializing in providing corporate and commercial services to non-resident offshore companies, and for the investment of offshore funds....
s. All types of life assurance and insurers pension plans, both single premium and regular premium policies offer these funds. They facilitate access to wide range and types of assets for different types of investors.
The range of fund choice for investment has grown significantly in recent years with the increased trend to provide unit-linked alternatives to popular unit trust
Unit trust
A unit trust is a form of collective investment constituted under a trust deed.Found in Australia, Ireland, the Isle of Man, Jersey, New Zealand, South Africa, Singapore, Malaysia and the UK, unit trusts offer access to a wide range of securities....
and OEIC funds styled as externally managed funds as opposed to the life assurance companies internally managed funds. Typically the externally managed fund links have higher charges; this is tolerated as the expectation is for better returns.
Nature of funds
The funds are open-ended investments made available through life assurance companies. Unlike most collective investments there is no independent body tasked with safeguarding the assets. The company may manage, promote and hold the assets on behalf of the policyholders. The policyholders have rights to the assets but do not own the units, nor are they readily redeemable.This said, in practice life insurance companies tend to be well regulated and depend on their reputation which ensures consumer confidence when investing.
External links
- Financial Services Authority (FSA) - regulates life assurance companies in the UKUnited KingdomThe United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
.