What Are Segregated Funds?

Segregated funds pool investors’ money and invest it in assets like stocks and bonds, similar to mutual funds, but they are governed under an insurance contract rather than securities law.

⭐ Unique Features of Segregated Funds

1. Capital Guarantees

Typically guarantee 75% to 100% of your original investment

Guarantee applies at:

Maturity (e.g., after 10 years)

Death of the policyholder

Example: If you invest $10,000 and markets drop, you may still get at least $7,500–$10,000 back depending on the guarantee level

2. Death Benefit Protection

If you pass away, your beneficiary receives the guaranteed amount or market value (whichever is higher)

This can help preserve wealth for heirs even in a market downturn

3. Creditor Protection

In certain cases (e.g., if you’re self-employed), seg funds may be protected from creditors

This is useful for:

Business owners

Professionals at risk of lawsuits

4. Probate Bypass & Fast Payout

Money goes directly to your named beneficiary

Avoids probate delays and fees

Faster access to funds compared to traditional investments

5. Reset Option

You can lock in market gains by resetting your guarantee value

Example:

Invest $10,000 → grows to $15,000

Reset → new guarantee based on $15,000

Helps protect profits over time