Generali Worldwide is a wholly-owned subsidiary of the Generali Group. Founded on the strength of this international presence and wide-ranging expertise, Generali Worldwide specialises in offering life-insurance-based wealth management and employee benefit solutions to a global audience, including multi-national organisations, international expatriates and local resident populations in licensed territories.
The company’s head office is based in Guernsey, a premier international financial centre, and is a Registered Insurer under the Insurance Business (Bailiwick of Guernsey) law, 2002 (as amended). It is also an authorised insurer in the Bahamas, British Virgin Islands, Cayman Islands, Hong Kong, Jersey and Singapore.
Generali offers a range of individual unit-linked regular and single premium-based savings, retirement and investment plans and an open-architecture portfolio bond along with group retirement and savings products, group life and disability and healthcare products.
The Professional Portfolio Bond, from Generali Worldwide, is a single premium, open-architecture, whole of life, life assurance product providing wealth management and estate planning options for tax-efficient investing.
It is available in a wide range of countries around the world and in US Dollar, GB Pound, Hong Kong Dollar, Japanese Yen or Euro.
The Generali Professional Portfolio Bond provides both flexibility and control to help you manage your wealth in a tax-efficient environment. Its versatility means that it is equally effective whether your investment strategy is geared for growth, capital preservation or to provide a regular income.
Perhaps the greatest criticism of this offshore investment bond is that its distribution strategy enables the supply of these type of sophisticated tax-deferral products to expatriates by unregulated intermediaries. This means many policy holders have not had the full charges disclosed to them and they hold inflexible, illiquid and expensive underlying investments. As such, the underlying investment performance does not match the client’s expectations over the long term.
Generali Worldwide Professional Portfolio Bond Key Features
Investment Options - Professional Portfolio offers two separate investment options. The Pooled Portfolio option enables you to build an investment portfolio from any recognised unit trust or mutual fund. The Personal Portfolio option extends the investment choice across a range of internationally quoted securities, including internal funds, mutual funds, open-ended investment company schemes and cash.
In addition the product allows for the Policy Owner to appoint an independent Portfolio Manager to act as an investment adviser to the portfolio.
Eligibility – Generali Personal Portfolio Bond is a whole of life, life assurance contract issued by Generali Worldwide. It is available to most international investors outside of the main regulated territories such as the UK, the USA and Australia.
Charges – The Generali Personal Portfolio Bond you take out facilitates a range of charging structures, largely driven by the amount of commission taken by your adviser or salesman. See the FAQ for more details.
Early Surrender Penalty:
If the Plan is fully surrendered, early discontinuance charges may be deducted from the Investment Value. The early discontinuance charge only applies on full surrender and only in relation to Investment Amounts for which less than 20 Charge Dates have passed since payment.
Pensions (QROPS and SIPP)
HEALTH WARNING!!!!! We have seen all too often the Generali Professional Portfolio Bond being used or sold to investors within QROPS and SIPPs. This is done in order to generate more commissions for the salesman. The Generali Professional Portfolio Bond should NOT be used within a QROPS or SIPP, because when you start to draw on your pension, then the charges may still apply on the original investment, which effectively means your charges will go up as the capital decreases and will erode some of the remaining capital and a quicker rate.
Establishment Charge:
The establishment charge is a percentage of each investment amount paid. It is deducted in arrears on each of the first 4 charge dates following payment of each investment amount and levied at 0.5% therefore a total of 2% per annum for one year.
Administration Charge:
An administration charge is also levied and is a percentage of the higher of
(1) Each Investment Amount
(2) Its associated Investment Value
Deducted on each of the first 20 Charge Dates, following payment of each invested amount. This amounts to 0.375% on each of the first 20 Charge Dates, following payment of each Investment Amount (1.5% per annum for 5 years).
Other Charges:
Service Charge – GBP 500 (or currency equivalent) per annum.
Fund management charges - usually 1% to 2.5% pa each year- depending on the funds chosen.
Dealing charges - made for each sale and purchase made within the bond at £35 per trade.
Adviser charges - additionally there may be an adviser charge to manage the portfolio, this typically can be between 1 and 1.5% per annum depending on the chosen advisers charging structure and service provided.
Ouch!
I was encouraged to transfer my pension - told horror stories about leaving it in the UK and tax and maximum lifetime contribution amounts. I was then told about the wonder of the portfolio bond - wow, you can wrap everything bar your fish and chips in it. I know I'm fortunate, as I've retired early, but less fortunate now I'm accessing my pension - because guess what, just as this review summarises, my charges are staying the same and effectively ramping up as I access my capital. Be very very wary of this product and those selling it - find out what's in it for them as well as you.
When used correctly, the Generali Professional Portfolio Bond is a reasonable product, but perhaps lacks transparency of some of the alternatives available and is expensive.
Our advice is to only incept such a plan after receiving advice from a fully regulated financial adviser and to opt for a cleanly priced option (this pays no commission to the agent). You should therefore ensure there is no form of establishment charge or lock-in period (zero-exit penalties).
If you already have a Generali Professional Portfolio Bond we recommend you have a free, no obligation X-Ray Review™ conducted to give you the information you need to make a decision on the best way forward.
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