Why Swiss Annuities?

To begin with, a deferred variable annuity is a policy or contract issued by a life insurance company, whereby upon receipt of an initial investment (also called a one-off premium) the insurance company agrees to pay the policy owner regular payments at an as yet to be determined time in the future.

The regular payments will be determined by the underlying value of the assets/investments held within the policy.

The deferred component of the annuity refers to the fact that all earnings/gains made by the underlying policy assets/investments are reinvested within the policy.

Using a deferred variable annuity purchased from Switzerland or Liechtenstein, there is no maximum age at which the annuity payments must commence, unlike an annuity policy purchased from an Australian insurance company which requires the payments to commence at retirement age.

A deferred variable annuity also has several other names that you may have heard of, and they include:

  • Swiss annuity
  • Liechtenstein annuity
  • Insurance wrapper
  • Private placement policy
  • Portfolio insurance bond

The main benefits of a deferred variable annuity from Liechtenstein or Switzerland as part of a life insurance policy are:

  • tailor-made asset protection
  • investor protection (in the event of insurance company bankruptcy)
  • diversified and flexible investment strategies
  • privacy protection
  • estate planning
  • potential tax benefits

How it works:

  • Clients purchase a policy with a foreign insurance company in Liechtenstein or Switzerland
  • The insurance company opens an account with a custodian bank (in Switzerland)
  • The funds are managed in the name of the insurer, according to the agreed strategy
  • In the event of death, the pay out will be made according to policy holder’s instructions
  • In the event of bankruptcy, ownership of the policy automatically transfers to the nominated beneficiary (if spouse or descendant) or to the irrevocably nominated beneficiary (such as family trust)

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