The Bâloise Group has provided insurance services in the Grand Duchy of Luxembourg since 1890 and is deeply rooted in the economic and social fabric of the country. Quality, transparency, respect and honesty are the values that guide its approach and enable the development of stable partnerships, based on trust.
Since the introduction of the Third Life Insurance Directive which defines and describes the Free Provision of Services (FPS) regime for insurance within the European Union, Bâloise Vie Luxembourg SA, as a Luxembourg sited and regulated life insurance company, has specialised in selling Life Insurance Contracts across the European Union since 1996.
The Baloise Group does not have a subsidiary or a branch in the UK but Bâloise Vie Luxembourg S.A., as an EU based entity, is authorised to carry out its activities there under the Freedom to Provide Services regime of the EU. The Baloise Group has operations in Switzerland (parent company), Germany, Belgium and Liechtenstein.
The ProFolio contract is a unit-linked whole-of-life insurance policy which enables the subscriber to build capital in a tax efficient manner and which shall be redeemed, subject to the realisation of a risk, via the payment of a Surrender Value at the time of the owners choosing or as a death benefit upon the insured event.
The consent of the insured party is not required, however it is required that the owner of the life insurance policy shall have an insurable interest in the person who life is being insured where the contract is written on UK Law. An individual is considered to have an Insurable interest when that loss would cause him to suffer a financial or other form of hardship or loss.
The payment of the death benefit is to be made to the policyholder(s) or policyholder’s personal representatives, or an assignee if notice of assignment has been given to and accepted by Bâloise Vie Luxembourg S.A. or to the trustees if a trust has been created.
For UK residents not exposed to UK Inheritance Tax on the policy, it's possible to designate beneficiaries within the policy. The death benefit will be paid to the designated beneficiaries.
There is no automatic need to declare the policy for UK residents, however any chargeable (taxable) event is reportable via the policyholder’s annual Self-Assessment form. The applicable tax on gains is the policy owner’s marginal rate of UK Income Tax.
At the beginning of each calendar year, you will receive, free of charge, a valuation statement featuring relevant information including the following:
- the surrender value of your policy;
- any surrenders from your policy;
- premiums paid over the previous year;
- the overall percentage performance of the policy, the names of investment funds linked to your policy, their unit value, and their investment performance over the period in question.
We can provide this information to you at any time upon request. An administrative fee of 25 euros will be levied for this service. The fee will be levied by cancellation of units proportionally across the funds that you have chosen.
The contract offers the following Choice of Law options; UK Law, Luxembourg Law or the Law of your European Nationality (if supported by Bâloise Vie Luxembourg S.A.). Whilst you may select the Law upon which the relationship between you, as policyholder, and Bâloise, as the insurer, Luxembourg law governs the prudential and technical standards to which Bâloise is subject to in the context of maintaining the policy.
Any potential disputes fall within the non-exclusive jurisdiction of the Luxembourg courts.
The Rome Regulation provides for choice of the applicable law for the policy and, thanks to portability, policies can “travel” (to a certain extent and under certain conditions).
For more information we invite you to contact us to receive our "Taxsheets".
An internal collective investment fund offered by Bâloise and limited to the set of assets attributed to it by Bâloise, with or without a guaranteed return and open to other policyholders of the Insurance Company. Units of internal funds such as a CIF can only be purchased by subscribing to an insurance policy issued by the company.
A Targeted Investment Strategy is an internal fund with its own segregated account, limited to a set of assets determined by the insurer, with or without a guaranteed return, and, in principle, dedicated to a single policy. The assets of a Targeted Investment Strategy are deposited with a custodian bank and the management is delegated, under a discretionary mandate, to a specialist fund manager.
The value of a Targeted Investment Strategy depends directly upon the value of those assets held on the segregated account. The total value will include the value of the underlying assets enhanced by uninvested cash, accrued interest not yet due, and reduced by expenses, taxes and other charges associated with day-to-day management of the account.
The costs associated with a Targeted Investment Strategy are detailed in its KID. Those costs include the management fees, custody charges and any transaction fees applied by the custodian bank or by the Asset Manager appointed.
A Select Investment strategy is a internal fund with its own segregated account invested in financial securities contractually limited to the "permitted assets" as defined by HMRC rules for Personal Portfolio Bonds composition.
The value of a Select Investment Strategy depends directly upon the value of the underlying assets held on the segregated account. The total value of the account will include the value of the underlying assets enhanced by uninvested cash, accrued interest not yet due, and reduced by expenses, taxes and other charges associated with day-to-day management of the account.
The costs associated with a Select Investment Strategy are detailed in its KID. Those costs include the management fees, custody charges and any transaction fees applied by the custodian bank.
The triangle of security is the colloquial name for the mechanism of investor protection, operated by the Commissariat aux Assurance, for policyholders of Luxembourg regulated insurers. The Triangle of Security ensures the legal and physical separation between policyholder assets, on the one hand, and the assets of shareholders and other creditors of an insurance company, on the other.
PRIIPs (Packaged Retail Insurance and Investment Products) is a European Regulation which, from 31st December 2017, regulates the provision of Key Information Documents (KIDs). The regulations are aimed at improving the transparency of financial products and the ease of their comparison with other products by a retail investor.
The products particularly affected by this regulation are as follows: UCITS (open-ended collective investment schemes), unit-linked insurance policies, alternative funds, convertible bonds, securitisation products, deposits and structured deposits.
To improve understanding of these products, rules have been introduced in relation to the provision of a basic key information document provided to subscribers: the PRIIP KID:
- The key information document must comprise a maximum of 3 A4 pages for each product and present, in a clear, succinct and comprehensive manner, the key information for the investment product for the prospective investor;
- The KID must be sent to the subscriber before purchase and commitment;
Therefore, promoters of these investment products (including, from now on, unit-linked life insurance policies) will be subject to the same obligations as issuers of open-ended collective investment schemes in terms of the information provided to subscribers via the KID.
The European Directive on insurance distribution, passed in 2015, is part of a process initiated in the 1990s focused upon harmonising the insurance market across the EU.
The Foreign Account Tax Compliance Act is legislation of the USA. It was adopted on 18th March 2010 and entered into force on 1st January 2013. It imposes the disclosure of information on American account holders to the IRS (USA Internal Revenue Service). In brief, it demands that financial institutions and other non-American entities are obliged to disclose information about their American account holders to the agency, Internal Revenue Service (IRS), with a risk of tax withholding of 30% for those who fail to do so.
Solvency II is a European Directive which entered into force on 1st January 2016, the objective of which is to harmonise and support the European insurance market in guaranteeing the solvency of insurers, i.e. their capacity to fulfil their commitments to insured parties.
These prudential regulations frame operational risk and requirements in terms of insurance companies’ own funds. They will also entail increased regulatory powers over insurance companies.
Consult here the figures of Bâloise Vie Luxembourg.
The standard for the automatic exchange of information developed by the OECD/the G20 was adopted on 20 October 2014 by all the OECD and G20 countries for tax purposes. It provides for the automatic exchange of all necessary client financial information (natural and legal persons) where the client resides in a country foreign to the service provider. Information is reported on an annual basis. Most jurisdictions undertook to implement this standard via reciprocal exchanges with all the reportable jurisdictions. In 2017, within the framework of the Common Reporting Standard, Luxembourg established a reporting to the tax authorities of the reportable countries.
Each subscriber and beneficiary (upon payment of a benefit) is required to complete a Tax Residence and US Status Form for the Automatic Exchange of Information and FATCA - "Tax Identification Form" to certify his or her tax residence.
With regards life assurance; during the life of the contract, the policyholder must immediately notify the insurance company of any change in tax residence. In this case, they will have to fill in a new tax identification form provided by the company.
The first reporting has been carried out on 30th June 2017 by banking establishments and insurance companies to the Luxembourg tax authorities which will forward the data in September 2017 to the concerned domestic revenues of the relevant jurisdictions. The reporting must be carried out annually at the same deadline.
Life assurance and capitalisation contracts are included within the reporting process.
Each subscriber being a natural person is obliged to complete a form identifying their tax residence and American status for the purposes of automatic information exchange under FATCA - “Tax Identification Form” and to do so to enable the Company to determine whether a subscriber should be considered as an American tax resident. Further, during the life of the policy, the subscriber must immediately inform the Company of any change of tax residence. In this case, he or she is required to complete a new tax identification form which will be provided by the company.