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SEGREGATED FUNDS
A segregated fund is a form of life insurance that is also a managed investment product similar to a mutual fund. Most segregated funds provide a death benefit that guarantees your beneficiaries will receive no less than 75% or 100% of your initial investment. If the market value of your investment at your death is greater than your initial investment, your beneficiaries would receive the larger amount.
Similar to other types of life insurance, the value of the segregated fund can be paid directly to a named beneficiary on your death and is not subject to probate tax.
The bottom line:
- segregated funds can provide the investment diversification and growth potential of mutual funds
- segregated funds may offer protection from creditors
