Hollard Guaranteed Income Plan

Hollard's Guaranteed Income Plan offers tax advantages and a five-year fixed monthly income.

Overview

Our Guaranteed Income Plan offers tax advantages and a five-year fixed monthly income investment.

Guaranteed Income is made up of two policies. An endowment policy provides a return of the premium after a five-year period and a temporary life annuity policy provides a five-year fixed monthly income.

Combined Policy

You invest a premium of

R100 000

Policy One

5 year temporary Life Annuity 

R22 790.90

Policy Two

5 year Endowment

R77 209.90

Payment of

R409.86 p/m

for 60 months (gross)*

Guaranteed Maturity value

paid out tax free

R100 000

These figures are for illustration purposes only
Minimum investment R100,000

* Please note that this annuity payment will cease after 60 months or on death of the life assured, whichever occurs first.

Features & Benefits

Features and Benefits of our Guaranteed Income Plan


Features and Benefits Product Details
Minimum Investment R100,000
Tax Implications This policy is governed by the Section 10A exemption of the Income Tax Act, which allows an exemption of the capital portion of a voluntary purchase annuity. Only the interest portion of the income payment is taxable.
Death Benefits
  • Provides a capital guarantee for beneficiaries
  • Allows you to create liquidity in your estate. Beneficiaries may be appointed and the proceeds are paid directly to them instead of forming part of your estate when you die
  • Enables your beneficiary to save on executors' fees
Access to Capital

You can surrender your policy in full or in part from the endowment policy portion only. (Only one surrender is permitted.) A new policy value and related new maturity value will be calculated using market rates at the time. 

Please note: Surrender charges will apply on a time-based scale.

Other Product Features
  • The policy may be used as security (on the endowment portion only)
  • Return is guaranteed (provided that the policy remains in force for the full term and there have been no surrenders)
  • Investment rates are revised weekly and are valid from Monday to Saturday. Rates apply on the date you deposit your funds into Hollard Investment bank account and we receive all documentation
  • Policies begin on the first day of any month – you will be credited with interest from the time your money is received by Hollard Investments to the date of inception of the policy
  • Any South African resident from 18 to 80 years old may invest in Guaranteed Income

Product Charges

Surrender charges

The Guaranteed Investment Rate applied to the investment is net of all fees. 

Policy Year Surrender 
One 1.50%
Two 1.25%
Three 0.80%
Four 0.50%
Five 0.00%

FAQs

What are Guaranteed Investments?

Find out everything you need to know about Guaranteed Growth Plan here.

What is the tax advantage of investing in a temporary life annuity policy?
This investment is governed by the Section 10A exemption of the Income Tax Act, which allows an exemption of the capital portion of a voluntary purchase annuity. The monthly income received is made up of capital plus interest. So only the interest portion of the income payment is taxable.
When do I receive a secure rate of return?
Rates are revised weekly and are valid from Monday to Saturday. The rates are applicable on the date you deposit your funds into the Hollard Investment bank account and we receive your completed documentation.
What happens to my money when it is in the Hollard Investment bank account?
Policies commence on the 1st of any month. You'll be credited with interest from the time Hollard Investments receives your money to the date of inception of the policy. The interest amount is taken into account at quotation stage and included in the rate of return and, therefore, the maturity value. Hollard Investments assumes the funds are received on Mondays, so interest is calculated from Monday to the day of commencement.
When is my first annuity payment made?
If the investment is quoted in advance, your first annuity is paid on the same day as the date of commencement. If it’s quoted in arrears, your first annuity is paid one month after the date of commencement.
Does the 30-day cooling-off period apply?
Due to the nature of this policy, the 30-day cooling-off period does not apply.
What is the minimum investment amount?
The minimum amount that you can invest is R100,000.
What is the term of the combined policy?
The Guaranteed Income policy has a five-year term.
Who may invest in the Hollard Guaranteed Income Plan?
Any South African resident of 18 to 80 years old may invest in the Guaranteed Income Plan. This product is not available to pension funds, companies, closed corporations or trusts.
What happens if the life assured passes away?
If no previous surrenders have been taken, the death benefit is guaranteed to be the maturity value as stated in the policy schedule. If a surrender has been taken from the endowment policy, the death benefit will be the fair value of the policy. On the death of the life assured, a death benefit will be paid out to the beneficiaries. The fair value of the policy is of the value of the endowment plus the commuted value of the monthly annuity payments on the temporary life annuity. This is calculated from the date of maturity to the date of claim, as signed for in the policy application form and policy quote.
Can surrenders be taken on the policy?
Only one surrender - either part or full - may be taken from the fair value of the endowment policy portion of the investment. A new policy value and related new maturity value will be calculated at market rates at the time. Please note that surrender charges will apply on a time-based scale.
Can the endowment portion of the policy be ceded?
Collateral cession - You can use this policy as security to raise a loan from a lending agency or a registered South African bank. The value of such security is at the discretion of the lending agency and implies no liability, either directly or indirectly, to Hollard. Outright cession - Hollard Investments will record a cession of the policy on receiving a written request to do so, and will note the cession without expressing any opinion on its validity. Due to the nature of the temporary life annuity, Hollard Investments doesn’t permit cessions on the annuity portion of this investment.
Are loans permitted against the policy?
Hollard Investments doesn't permit a loan to be taken on either portion of the policy.
How is the tax calculated on the temporary life annuity policy?
In terms of the law, tax must be deducted at the source (i.e. by the life insurance company). The tax due on the taxable portion is deducted according to the tax tables – SITE and PAYE. The life insurance company will apply the tax tables as if all annuities paid by an insurer are the sole source of income. Hollard Investments will pay the tax to the Receiver of Revenue and issue the policyholder with an IRP5 at the end of the tax year. If no tax has been deducted, Hollard Investments will issue an IT3A. You can also give us a tax directive.
Can the income be changed mid-term?
No, the income is fixed for 60 months.
Is this investment subject to Capital Gains Tax (CGT)?
Under current legislation, the investment maturity is not subject to CGT in the hands of the original policy owner.
Is my income guaranteed?
Yes, your income is guaranteed if the policy has been in force for the five-year term. However, a change in tax legislation may affect the guarantee.
Do I need a Financial Advisor to invest in this product?
Yes, Hollard Investments does not accept any investment into this product without a Financial Advisor being appointed.

Customer Support

Contact details

  • Tel: 0860 202 202
  • Email: hwnewbusiness@hollard.co.za
  • Fax: +27 11 351 3816
  • For compliments and complaints please fill in the Customer Support form on the right. Alternatively view our complaints process by clicking here.

Select and complete the form of your choice

  • Select the relevant form from the list below
  • If you are completing an Investment Application form, please appoint a Financial Advisor
  • Applications for this investment will not be processed without a Financial Advisor being appointed. Your Financial Advisor will be required to request a valid quote from Hollard Investments for all new application
  • Print and complete the form
  • Attached all required documentation, including FICA documentation (for new investment applications)
  • E-mail or fax the completed form to hwnewbusiness@hollard.co.za or +27 11 351 3816
First-time Investors Existing Investors
Application Form Death Claim Form
Surrender Request Form
Maturity Reinvestment Form
Maturity Encashment Form
Static Details Change Form
Security Cession Form
Outright Cession Form
Financial Advisor Appointment Form
General Disclaimer and Indemnity Surrender Proceeds 3rd Party Form
Beneficiary Nomination Form