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[Critical Illness Insurance] Product Update: Compare whole-of-life critical illness insurance from three major insurers: AIA vsManulifevs Prudential (Q3 2021)
The onset of a critical illness is unpredictable. Taking out whole-of-life critical illness insurance provides lifelong protection, so you are prepared should you unfortunately be “chosen” at any time. When choosing critical illness insurance, many customers consider the insurer’s brand and history, ensuring that the insurer can provide stable and long-term protection for their health throughout their lives. Today’s critical illness insurance has developed beyond serious critical illness protection to include more coverage benefits, with new features continually being introduced. In this article, 10Life compares the popular whole-of-life critical illness insurance plans (updated versions) from Hong Kong’s three major insurers from different perspectives, including AIA AIA Wealth Achiever 3, ManulifeManulifeManuBright Care 2 (Enhanced Version) and Prudential Health Critical Illness Extended Care III, to help readers understand the features of these products.
Manulife pays more for serious critical illnesses, while Prudential offers better early critical illness benefits
Critical illness insurance provides a lump-sum payment when the insured is diagnosed with a specified covered illness. Critical illness insurance mainly covers serious critical illnesses and early critical illnesses. Serious critical illnesses, such as cancer, heart disease and stroke, generally pay 100% of the sum assured (Note 1). If diagnosed during the early policy period, such as within the first 10 years, the payout may be as high as 150% of the sum assured. Assuming the policyholder is a 35-year-old non-smoker, pays an annual premium of $12,000 (in Hong Kong dollars, the same below) and makes payments for 25 years, Figure 1 shows that if a serious critical illness occurs within the first 10 years, Manulife’s critical illness plan provides a higher payout, approximately $579,000 (female) to $621,000 (male), followed by Prudential’s payout of $544,000 (female) to $564,000 (male). After a serious critical illness claim, future premiums are waived, while lifelong critical illness protection continues.
As people are becoming increasingly health-conscious and regular medical check-ups mean that many illnesses can be detected at an early stage, early critical illness protection is also receiving greater attention. We compare the early critical illness benefits of the three products using carcinoma in situ and angioplasty, two common early critical illnesses. Prudential’s critical illness plan offers the highest payout, approximately $90,000 (female) to $94,000 (male). It is worth noting that Prudential’s premium waiver mechanism also covers specified early critical illnesses: after diagnosis, the insured can have premiums waived for the following 12 months and focus on treatment.
Figure 1: Comparison of serious critical illness and early critical illness protection under popular whole-of-life critical illness insurance plans from AIA, Manulife and Prudential
Assuming the insured is a 35-year-old non-smoker, pays an annual premium of HK$12,000 and makes payments for 25 years. The claim occurs within the first 10 years of the policy.
Assuming the insured is a 35-year-old non-smoker, pays an annual premium of HK$12,000 and makes payments for 25 years. The claim occurs within the first 10 years of the policy.
| Product / Payout | AIA Wealth Achiever 3 | Manulife ManuBright Care 2 (Enhanced Version) | Prudential Health Critical Illness Extended Care III | ||||
| Serious critical illness (claim within the first 10 years of the policy) | Male | $543,442 | $621,047 | $564,086 | |||
| Female | $524,781 | $579,648 | $544,135 | ||||
| Serious critical illness premium waiver protection | After a serious critical illness claim is made, the insured is no longer required to pay any premiums for the plan. | ||||||
| Early critical illness: Carcinoma in situ / angioplasty | Male | $80,510 | $82,806 | $94,014 | |||
| Female | $77,745 | $77,286 | $90,689 | ||||
| Early critical illness premium waiver protection | X | X | Waiver of premiums due for the following 12 months | ||||
| Notes: 1. The above information is provided by 10Llife, updated to 31 May 2021, for reference only and does not constitute sales advice. 2. Assuming the insured is a 35-year-old non-smoking male or female, pays an annual premium of HK$12,000 and makes payments for 25 years. 3. The payouts include the additional early policy-period benefits applicable during the first 10 years of the policy. 4. The currencies of the policies above are US dollars, assuming a USD:HKD exchange rate of 1:8. | |||||||
Ongoing cancer treatment: Prudential offers the highest cumulative payout
Cancer is certainly frightening, but it is no longer necessarily incurable. With ongoing cancer treatment, patients’ survival rates have increased significantly, and living with cancer for many years is no longer impossible. However, medical expenses for targeted drugs and immunotherapy are high, and treatment may also last for a considerable period, placing an unbearable financial burden on patients. In response, insurers have introduced ongoing cancer treatment benefits. During the waiting period between serious critical illness claims, the insured can receive an additional payout provided they continue to undergo active cancer treatment, such as surgery, radiotherapy, chemotherapy or targeted drug treatment.
We compare the cumulative payouts of the products at different stages using a case involving eight years of cancer treatment. Assuming the policyholder is a 35-year-old non-smoking female, with the same premium and payment period.
Figure 2: Comparison of ongoing cancer treatment protection under popular whole-of-life critical illness insurance plans from AIA, Manulife and Prudential
Assuming the insured is a 35-year-old non-smoking female, pays an annual premium of HK$12,000 and makes payments for 25 years.
Assuming the insured is a 35-year-old non-smoking female, pays an annual premium of HK$12,000 and makes payments for 25 years.
Notes:
1. The above information is provided by 10Llife, updated to 31 May 2021, for reference only and does not constitute sales advice.
2. Assuming the insured is a 35-year-old non-smoking female, pays an annual premium of HK$12,000 and makes payments for 25 years. The above payouts are the average payouts at different times over 50 years and include the additional early policy-period benefits applicable during the first 10 years of the policy.
3. The currencies of the policies above are US dollars, assuming a USD:HKD exchange rate of 1:8.
1. The above information is provided by 10Llife, updated to 31 May 2021, for reference only and does not constitute sales advice.
2. Assuming the insured is a 35-year-old non-smoking female, pays an annual premium of HK$12,000 and makes payments for 25 years. The above payouts are the average payouts at different times over 50 years and include the additional early policy-period benefits applicable during the first 10 years of the policy.
3. The currencies of the policies above are US dollars, assuming a USD:HKD exchange rate of 1:8.
When the insured is diagnosed with cancer, that is, treatment lasting less than one year, and makes the first serious critical illness claim, Manulife’s critical illness plan provides the highest payout, approximately $430,000 (Note 2).
If the insured continues to undergo active treatment in the first and second years after diagnosis, they can receive ongoing cancer treatment protection each year. Prudential pays 60% of the basic sum assured each year, meaning that its cumulative payout is the highest in the second year, reaching $830,000.
The waiting period between cancer claims is three years. Therefore, in the third year, the insured receives the second serious critical illness claim. Prudential has the highest cumulative payout, approximately $1.2 million.
During the fourth and fifth years, insured persons under Prudential and Manulife can again receive ongoing cancer treatment protection, and their cumulative payouts continue to increase. AIA does not provide this protection, so its cumulative payout remains unchanged.
In the sixth year, insured persons with cancer under AIA, Prudential and Manulife can all make their third serious critical illness claim, but Prudential’s cumulative payout remains the highest.
During the seventh and eighth years, Prudential and Manulife insured persons who are still receiving treatment can again receive ongoing cancer treatment protection. Prudential’s cumulative payout is the highest, reaching $2.43 million. AIA does not provide this protection.
Additional protection for infectious diseases and family members
In addition to covering specified illnesses, whole-of-life critical illness insurance aims to provide more types of benefits in response to customer needs. With the global COVID-19 pandemic, people are concerned about protection against infectious diseases. Insurers have also introduced relevant benefits. AIA’s critical illness plan pays 20% of the sum assured if the insured contracts an illness classified by the World Health Organization as a public health emergency of international concern and is admitted to an intensive care unit for three days or more. However, the requirements under Manulife’s and Prudential’s critical illness plans are less restrictive: the insured only needs to be admitted to an intensive care unit for three days or more, regardless of the cause, including an infectious disease, to receive 20% of the sum assured.
Insurers also provide family protection. Many parents now take out insurance for their young children at an early age to enjoy lifelong critical illness protection. However, they may worry that if they unfortunately die during the premium payment period, the child (the insured) will be unable to pay the remaining premiums. To address this situation, AIA’s and Prudential’s critical illness plans both provide premium waivers, meaning that the child (the insured) does not need to pay future premiums and can continue to receive protection (Note 3).
In another situation, AIA’s critical illness plan also provides protection if the policy is taken out for a spouse and the policyholder or beneficiary unfortunately dies before the age of 80, provided that the policy has been in force for two years. The spouse (the insured) can then have future premiums waived (Note 4).
Prudential’s critical illness plan provides additional family protection. If any two family members, such as the policyholder and their spouse, the policyholder and their child, or two children, are insured together, and one of the insured persons unfortunately dies within the first 10 years, the beneficiary receives an additional payout of 50% of the sum assured.
Due to space limitations, this article compares only the major benefits of the relevant whole-of-life critical illness insurance plans. Readers who wish to compare other details in greater depth can visit the “Product Decoder” on the 10Life website or consult a licensed adviser on the website.
Notes:
- The basic payout for a serious critical illness is 100% of the sum assured, without taking into account any additional early policy-period benefits (where applicable) and assuming that no early critical illness claim has been made previously.
- Assuming the claim occurs within the first 10 years of the policy, including the additional early policy-period benefits.
- Future basic premiums for the relevant plan are waived for the insured child until the insured reaches age 26 (age at the next birthday) or the end of the premium payment period, whichever is earlier.
- If the insured’s spouse, who must be the policyholder or beneficiary, unfortunately dies before the age of 80 and the policy has been in force for two years, future premiums for the basic plan will be waived for the insured.
- The above information is provided by 10Life, updated to 31 May 2021, for reference only and does not constitute sales advice.
This English version of this article has been generated by machine translation powered by AI. It is provided solely for reference purposes. In the event of any discrepancy or inconsistency between this translation and the original Chinese version, the Chinese version shall prevail.
10Life Editorial Team
Our team of professional content researchers focussing on insurance
10Life Editorial Team
Our team of professional content researchers focussing on insurance
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