July 2, 2022

Diversifying your wealth is an excellent strategy to ensure your investment portfolio thrives. One strategy is to purchase Segregated Funds and Annuities, which are available from insurance companies. As a Life Insurance Agent, you will need to be familiar with these products as you may sell them one day. Learn more about LLQP Segregated Funds and Annuities below.

What is an annuity?

Before we discuss segregated funds, we have to define annuities. An annuity is a financial product that guarantees steady cash flow during someone’s retirement years. Those concerned about outspending their assets may choose to purchase annuities from an insurance company.

When clients agree to purchase an annuity, they will enter an agreement to pay a specific amount of money, whether in installments or all at once. You can think of it as an insurance contract between the client and the insurer. Then, in the future, for example, during retirement, the purchaser or annuitant will receive payouts. Depending on the contract, these payouts may last ten years or even a lifetime.

Annuities are also structured in many different ways. Depending on the details, you may receive a payout for a specific term or over your lifetime. Annuities are also fixed, immediate, variable, or deferred.

What is a Segregated Fund?

A segregated fund is a form of investment similar to a mutual fund. It’s a pool of money from different investors that helps increase the fund’s value. The money is invested in various securities, including stocks and bonds. However, what sets apart a segregated fund from a mutual fund is that a segregated fund is an insurance contract. You can learn more here.

In addition, segregated funds’ structure is like deferred variable annuities. This means that the payouts that the annuitant will receive will take place in the future, and the size of the payment will depend on the fund’s performance. Good performance means a larger payout, while poor performance equals a smaller payout.

Furthermore, the investor will have many options. They can choose a segregated fund based on product terms, payouts, and investment objectives. Unlike annuities, the investors will begin receiving payouts after the specified maturity date.

LLQP Segregated Funds and Annuities course

So, why does it matter whether you know about segregated funds and annuities? Life insurance companies are one of the few places that offer these products. In addition, agents who wish to sell these products must hold a life insurance license.

To obtain a life insurance license or LLQP, you will need to know four key topics, one of which encompasses segregated funds and annuities. Learn more about the LLQP license here.

However, if you are already a Life Agent and need your CE hours, you can take our Segregated Funds and Annuities CE courses to satisfy your CE requirements!

Need to get your LLQP Segregated funds and annuities course or CE courses?

Look no further. Follow this link here to our LLQP Exam Prep course. If you are seeking CEs, we have Segregated Funds or Annuities. If that’s not enough, we even got a Life CE subscription just for you here!

Jacques Wong is the CEO and Director of Education at PNC Learning. An award-winning licensed insurance broker with over 15 years of experience in both education and the insurance industry, Jacques is recognized for his expertise and effective communication strategies. He achieved the highest provincial scores on his CAIB* 3 and CAIB* 4 exams and contributes to leading insurance publications. Jacques is dedicated to making insurance knowledge accessible for everyone through his unique approach and online content.

Jacques Wong

 Jacques wong


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