The table below provides a brief overview of the advantages and disadvantages. It quickly becomes apparent that the advantages of a bank solution outweigh those of an insurance policy.
In summary, a cost-effective and broadly diversified bank solution with investments in securities is preferable to an insurance solution. Pillar 3a assets, income, capital gains, dividends and interest are not subject to income, wealth or capital gains taxes. It is therefore an excellent vehicle for taking full advantage of the compound interest. However, this compound interest is severely limited in insurance solutions due to the fees and the fact that insurance premiums are paid directly from the tax-optimized pillar 3a. This disadvantage alone can cost the average pension beneficiary hundreds of thousands of francs or more until retirement.
The listed advantages and disadvantages support the generally known rule of thumb not to mix saving and insuring. Risk insurance should be taken out separately if necessary. This way, you know exactly what price you are paying for the insurance coverage and can cancel it early and at a reasonable price if the insurance is no longer needed due to new life circumstances. VIAC offers exactly this with the product VIAC Life Plus, where additional cost-effective and flexible risk coverages can be added separately. This way, you benefit from the advantages of both solutions without having to live with disadvantages.
1 Cost transparency varies among banks. VIAC places great importance on the costs being shown in a transparent and easy to understand manner. In our app, the monthly statement of charges can be accessed at any time.
2 Here, too, there are major differences. VIAC offers very attractive fees. At other banks, the fees can be up to 3 times higher. Fees eat your yield and therefore have a big impact on your retirement assets.
3 We have turned this disadvantage into an advantage. With VIAC, you benefit from free base protection in the event of disability or death. And additionally, we have launched VIAC Life Plus. This allows you to add additional coverages flexibly, transparently and at attractive prices – without long terms or notice periods. The premiums for this are not paid from your pillar 3, but simply per credit card.
4 The TER of these funds can quickly exceed 1%, often even higher. By comparison, the TER for our Global 100 strategy is 0.01%.
5 We know of cases where closing fees of up to CHF 690 have been incurred. These are then deducted from the surrender value – which may already be less than the sum of the payments made.