We are pleased to announce that effective May 1, 2018 to April 30, 2019, the Performance Bonus Rate for the BMO Insurance Whole Life Plan will be 5.75% - an increase of 0.25% above the minimum guaranteed rate.
We will apply this rate on each policy’s anniversary in that period to calculate the Performance Bonus and automatically purchase additional “paid-up” insurance coverage (or a “Paid-Up Addition”). 
Determining the Performance Bonus Rate
The Performance Bonus Rate takes into account the rate of return of a portfolio1 of fixed income investments and enhanced equity investments designed to target higher overall portfolio yields. To reduce the year-to-year fluctuations (i.e. volatility) of the Performance Bonus Rate, BMO Insurance uses a smoothing formula with a goal of generating more stable, long-term returns.
Asset Exposure Composition
The current portfolio is based on an asset exposure mix of:
- Fixed income investments (bonds, real estate) managed by BMO Asset Management and indexed to the yield of the BMO Long Term Corporate Bond ETF (ZLC); and
- Enhanced equity investments managed by BMO Capital Markets with returns indexed to the Low Volatility TSX (TXLV) and S&P500 (SP5LVI) market indices.
BMO Insurance, in partnership with BMO Asset Management and BMO Capital Markets, provide you and your clients with the expertise that backs up this unique structure.
What’s more
The Performance Bonus Rate is guaranteed to never be negative and will be at least 5.50% until April 30, 2020.
1 As part of a BMO Life Assurance Company policy, you do not own a legal interest in any security or fund.
MB 520 (2018/04/11)