How much are the premiums of investment-linked insurance policies or retirement insurance policies in Vietnam? How much are the fees charged to the policyholder?
How much are the premiums of investment-linked insurance policies or retirement insurance policies in Vietnam?
Pursuant to Clause 1, Article 98 of Decree 46/2023/ND-CP, regulations on premiums of investment-linked insurance policies or retirement insurance policies are as follows:
Premiums of investment-linked insurance policies, retirement insurance policies
1. Premiums of investment-linked insurance policies, retirement insurance policies include:
a) Basic insurance premium as prescribed in Clause 2 of this Article;
b) Additional insurance premiums as prescribed in Clause 3 of this Article.
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Accordingly, the premiums of investment-linked insurance policies and retirement insurance policies includes:
- Basic premium:
+ Basic premium is the premium determined based on the sum insured chosen by the customer and specified in the investment-linked insurance policy, the retirement insurance policy. The basic premium is paid periodically or once as agreed in the insurance policy;
+ The compulsory payment period for an investment-linked insurance policy with periodic basic premiums shall not exceed 4 years. During the compulsory payment period, the insurer must ensure that the investment-linked insurance policy is not lapsed if the customer has fully paid the basic premium and there is no withdrawal from the account.
- Extra premium:
+ In addition to the basic insurance premium, the policyholder may pay an extra premium to invest in the universal life fund (for universal life insurance product) or to purchase units (for unit-linked insurance product) or to invest in a voluntary retirement fund (for retirement insurance product);
+ As for investment-linked insurance policies, in each policy year, the total extra premiums paid must not exceed 5 times the annual basic premium rate of the current policy year (for regular premium policy) or does not exceed the basic premium (for single premium policy).
How much are the premiums of investment-linked insurance policies or retirement insurance policies in Vietnam? How much are the fees charged to the policyholder?
How much are the fees charged to the policyholder in Vietnam?
Pursuant to Clause 1, Article 99 of Decree 46/2023/ND-CP stipulating the fees charged to the policyholder include:
(1) Initial fee: used to cover expenses related to the use of insurance policies, capital costs of the insurer. The initial fee is deducted as a percentage (%) of the premium when the policyholder pays the premium. The premium after deducting the initial fee is the part that is invested and allocated to the investment-linked fund (for investment-linked insurance policy), voluntary retirement fund (for retirement insurance policy) within 30 days from the date the insurer receives the premium;
(2) Policy management fee: used to cover costs related to maintaining the insurance policy and providing information related to the insurance policy for the insurance buyer. Policy management fee is deducted from the account value of the policyholder;
(3) Risk fee: used to pay death and disability benefits as committed in the insurance policy. Risk fee is deducted from the account value of the policyholder;
(4) Fund management fee: used to pay for investment, asset valuation, fund supervision and management. The fund management fee is determined as a percentage (%) of the net asset value of the investment-linked fund (for investment-linked insurance policy), the voluntary retirement fund (for the retirement insurance policy). Fund management fee is deducted before determining investment returns of investment-linked fund (for investment-linked insurance policy), voluntary retirement fund (for retirement insurance policy);
(5) Early termination fee (applicable to investment-linked insurance product): used to cover reasonable expenses related to the policyholder's termination of the insurance policy early. Early termination fee is deducted from the account value of the policyholder;
(6) Unit-linked fund conversion fee (applicable to unit-linked insurance product): is the fee charged to the policyholder when converting investment assets between unit-linked funds;
(7) Retirement insurance account transfer fee (applicable to retirement insurance product): is a fee that a policyholder must pay to the current insurer when transferring their retirement insurance account to a new insurer.
Vietnam: How many days in advance must insurers notify the policyholders in case the insurer changes the fees?
Pursuant to Clause 3, Article 99 of Decree 46/2023/ND-CP has this content as follows:
Fees charged to the policyholder
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3. The fees charged to the policyholder must be clearly stated in the insurance policy. During the performance of the policy, in case the insurer changes the fees or rates of fees applicable to the policyholder, the insurer is responsible for notifying the policyholder in writing at least 3 months before the official date of change. The fee or rate of fee to be changed must not exceed the maximum limit agreed in the insurance policy.
Accordingly, during the performance of the policy, in case the insurer changes the fees or rates of fees applicable to the policyholder, the insurer is responsible for notifying the policyholder in writing at least 3 months before the official date of change.
At the same time, the fee or rate of fee to be changed must not exceed the maximum limit agreed in the insurance policy.
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