Insurance companies after an alert for the provision of SII with regard to insurance with savings

Caring for the Life Insurance Industry created a tax document issued by the Internal Revenue Service (SII) three weeks ago.

In December last year, the Authority published the Tax Complement 2019, which explains the situation regarding the payment of taxes for this type of instrument.

In this regard, the Association of Insurance Companies of Chile (AACH) has shown a surprise, especially with regard to life insurance.

"This is surprising, since in the past year there was no tax change that could lead to this innovation," said AACH Vice President Jorge Claude.

However, it ensures from the service that it is a provision that has always existed. "In accordance with the applicable regulations, any insurance that generates profits, returns or capital increases is taxable," they stressed.

They also point out that they met with industry representatives in August to explain that insurance in this area is insured against an amount that has been saved during the term of the contract or at the end of it, is taxed to the extent that there is an increase. "

In this regard, the association and the undertakings concerned have worked intensively to fully understand the scope of these provisions. They say that they evaluate various common or individual measures aimed at explaining what the service is referring to in this case and defining the characteristics of life insurance for the payment of taxes.

Insurance concerned

This segment consists of a single investment (CUI) and life-saving (SVA) insurance.

CUI insurance combines protection and savings and is part of the private savings segment.

The participation of this type of insurance in the field of life insurance amounts to 9.4%.

According to the policies issued, since September last year, 72,683 policies were issued, which is 5.8% more than in the same period of 2017, according to AACH data.

In terms of the premium, in the third quarter of 2018, the direct premium for this type of instrument amounted to USD 434 billion, which is equal to a 29% reduction compared to September 2017.