10Life Financial Limited
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Address: 16/F Greatmany Centre, 109-115 Queen’s Road East, Wan Chai, Hong Kong
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[130 Years of Commitment] Expected returns double every 10 years, taking family wealth legacy one step further.
In recent years, environmental, social and governance (ESG) has become highly popular, and the scale of ESG-related investments has gradually expanded. In addition to traditional financial data analysis, investors now also pay attention to business conditions that are not reflected in financial statements, so as to assess corporate quality and investment value from more angles and reduce the chance of losses caused by oversight. As a result, ESG-themed products are increasingly favoured by investors, and the insurance market has finally welcomed its first savings product with an ESG focus1 — Sun Life Hong Kong Limited (hereinafter referred to as Sun Life) has launched the “Stellar Savings Plan” (hereinafter referred to as Sun Life Stellar).
Sun Life Stellar focuses on investing in assets with high ESG scores, with the aim of delivering sustainable and better returns over the long term. With a 2-year premium payment term, Sun Life Stellar is expected to double the total cash value2 every 10 years from the 10th policy year onwards. The longer the period, the greater the compounding effect, enabling policyholders to pass on wealth from one generation to the next by making good use of the plan.
Compared with other ESG assets in the market, such as funds or equities, Sun Life Stellar makes use of the strengths of participating insurance. In addition to guaranteed cash value, which provides added peace of mind, the investments are managed by Sun Life’s entire team of professional investment specialists, removing the burden from policyholders. Policyholders can also share in the profits generated by the relevant investments in the form of non-guaranteed dividends. Even in volatile market conditions, better-than-expected and worse-than-expected experiences are smoothed out over time, resulting in relatively stable dividend distributions. In most cases, this demonstrates stronger downside resilience, offering policyholders a balanced choice between risk and return.
Advantages of Investing in ESG Assets
Policyholders may be unfamiliar with ESG. ESG is divided into three parts: E stands for Environmental, S stands for Social, and G stands for Governance.
Table 1: Introduction to ESG and examples
ESG category | Examples |
Environmental | Climate change, natural resource shortages and environmental pollution |
Social | Labour issues, public health and information security |
Governance | Board quality and corporate policies |
By referring to ESG standards or disclosures, investors can uncover elements of a company that are not reflected in its financial reports, and this also helps to identify the company’s sustainability capability. In general, companies with strong ESG performance tend to excel in areas such as corporate governance and handling labour-related issues. They are also less exposed to risks such as strikes, litigation and negative publicity, thereby delivering sustainable returns.
One example is the food and beverage industry. If a company lacks adequate governance and is unable to monitor food quality or the production process systematically, although this may reduce management costs in the process, it also makes it more likely for “unsafe food” to emerge. Ultimately, this damages the company’s image and may even affect consumer confidence and health, thereby causing irrecoverable losses to the company’s performance. In addition, if a company does not take the environmental impact of its production process into long-term consideration, once the government tightens environmental pollution policies, it will be very difficult for the company to replace machinery and adjust production lines in the short term, ultimately affecting its performance.
Applying its proprietary ESG framework, Sun Life EverBright Selects High-Quality Assets
The “Fuyue Savings Plan” launched by Sun Life永明 is the market’s first savings product themed around ESG concepts1. In screening assets with high ESG scores, Sun Life永明 not only makes use of data from some internationally recognised third-party ESG data providers, but has also developed its own proprietary ESG framework. A full team of professional investment specialists analyses the data of each asset from multiple angles, enhancing the accuracy of selecting quality assets.
In addition, the parent company based in Canada, Sun Life Financial Inc, has also had its efforts in ESG recognised with an MSCI ESG “AA” rating3, which is sufficient to demonstrate that it is a leader in the insurance industry in managing significant ESG risks and opportunities.
Sun Life永明 has been established in Hong Kong for 130 years, with a solid investment track record and a deep understanding of the needs of Hong Kong people. As at the end of 2021, total invested assets amounted to HK$87.2 billion, of which HK$47.5 billion (approximately 54.4%) were participating insurance products, and its financial position remained robust. In January 2020, Sun Life永明 was further assigned an AA- rating by S&P Global Ratings, with a stable outlook, demonstrating its exceptional financial strength and giving customers peace of mind to entrust their future to it, and to journey through the coming decades together.
When choosing a wealth succession product that rolls over across generations, it is best to prioritise an insurer with strong financial stability and a long history, so as to avoid the risks arising from insurer insolvency or debt default. Choose a quality savings product, choose a quality insurer, and take one more step forward in preserving family wealth for the next generation.
Invest in long-term sustainable ESG assets to help create a better world for the future
As assets with higher ESG ratings are exposed to a lower risk of accidents, they also have a certain degree of resilience in downturns, making them particularly attractive in the current volatile market. 永明富越 is a long-term sustainable wealth succession plan, enabling family wealth to be passed down from one generation to the next, in line with the long-term sustainable nature of ESG. Long-term investment in assets that benefit the environment and social development can help create a better world for the next generation.
In addition to delivering sustainable returns, 永明富越 also offers flexibility in asset succession. It allows cover for 1 insured person (single life) or joint cover for 2 insured persons (joint life) aged between 0 and 804. The policyholder may switch between the two cover options according to their needs4, and may flexibly exercise the insured person replacement option4 without any additional charge. In other words, if the policyholder chooses joint cover for 2 insured persons (joint life), even if one insured person were to pass away unexpectedly, the policy would still remain in force, allowing the policyholder to continue passing on their wealth without worrying about the policy being interrupted.
永明富越 has a premium payment term of just 2 years, with a total minimum premium of US$20,000 (approximately HK$156,000). Premiums can be paid flexibly on an annual, semi-annual or monthly basis, and the coverage period lasts until the insured person’s age 120 (single life) or the younger insured person’s age 120 (joint life).
Guaranteed once the reversionary bonus is declared, a rarity in the market
From the 3rd policy year onwards, the life assured can use 永明富越 to obtain stable returns in the form of guaranteed cash value. In addition, 永明富越 also offers annual reversionary bonuses5 and a one-off terminal bonus5. Unlike most products on the market, where only the face value of the reversionary bonus becomes guaranteed after declaration, the cash value of the reversionary bonus of 永明富越 also becomes guaranteed upon declaration, and the declared portion will further accumulate within the policy to enhance its guaranteed component. This is truly rare in the market, and it also demonstrates Sun Life’s commitment to its long-term mission of helping customers build wealth.
Sun Life Prosperity assists with the transfer of family wealth, with flexible options for changes and withdrawals midway through the policy term
Table 2: Mr Chan, aged 30, takes out a combined total of US$100,000 in Sun Life Stellar over two years
First generation | Second generation | Third generation | Fourth generation and beyond | ||
| Policy year | At policy inception | Year 15 | Year 35 | Year 50 | Mr Chan’s daughter can change the coverage options or change the insured option4 as needed until the end of the coverage period, thereby passing on Mr Chan’s wealth. |
| Policy owner | Mr Chan (aged 30) | Mr Chan (aged 45) | Mr Chan’s daughter (aged 35) | Mr Chan’s daughter (aged 50) | |
| Insured | Mr Chan (aged 30) | Mr Chan (aged 45) + Mr Chan’s daughter (aged 15) | Mr Chan (aged 65) + Mr Chan’s daughter (aged 35) | Mr Chan’s daughter (aged 50) + Mr Chan’s grandson (aged 15) | |
Using Mr Chan, aged 30, as an example, he is the first generation in the family’s wealth succession and acts as both the policy owner and the insured. He takes out US$100,000 in total over two years (equivalent to approximately HK$780,000). When Mr Chan is 45, he exercises the coverage change option4 and adds his 15-year-old daughter as an insured. When Mr Chan reaches 65, as he gets older, he decides to transfer the policy to his daughter, who is then 35, making her the policy owner. She becomes the second generation to inherit Mr Chan’s wealth.
When Mr Chan is 80, his daughter is already 50. She can exercise the coverage change option4 again, changing the insured from Mr Chan to her 15-year-old son. She may even transfer the policy to her son in the future, making him the third generation to inherit the wealth, and so on, until the end of the coverage period, effectively passing wealth from one generation to the next.
In addition to wealth succession, Sun Life Stellar also takes into account the different life stages of the policyholder, allowing them to withdraw all or part of the cash value of accumulated reversionary bonuses, if any6, to meet their lifestyle needs. For example, when Mr Chan goes through life stages such as marriage and having children, buying a home, and paying for his children to study overseas, he can withdraw funds from Sun Life Stellar, or choose to let the funds continue to accumulate, preparing for a comfortable retirement. He can even pass this wealth on to his daughter. When his daughter gets married, has children, or needs funds for property purchase, she can once again withdraw funds from Sun Life Stellar, truly completing the wealth succession.
This shows that Sun Life Stellar integrates ESG principles into its investment strategy by focusing on assets with high ESG scores. This not only helps manage risk flexibly, but also optimises opportunities to provide policyholders with attractive long-term returns. In addition, Sun Life Stellar’s flexible coverage change option4, insured change option4 and policy owner change option4 can be exercised by policyholders when needed. Used flexibly, these features can serve as a tool for passing on family wealth effectively from one generation to the next, while allowing the wealth to grow and providing funds for family members at different life stages.
Subscribe now to enjoy a limited-time multi-customer offer.
Just a reminder, from 7 October 2022 to 31 December 2022, if you successfully apply for 永明富越 (2-year premium payment term) and meet the specified first-year annualised premium requirement, you can enjoy a premium rebate of up to 3% of the first-year annualised premium. If you pay the full premium at policy issuance and use Sun Life’s electronic services (namely e-application service, e-policy and e-notification service), you can also enjoy a guaranteed 5% annualised interest rate on prepayment each year. The offer is subject to terms and conditions. For details, please refer to the leaflet immediately!
In addition, Sun Life has also added a number of new features to this product to strengthen its wealth legacy advantages, while offering a variety of premium payment terms, bringing greater flexibility to better meet policyholders’ needs.
The above information is only a product summary and does not include the full policy terms and cover. For details, please contact your financial adviser. For definitions and full terms and conditions, including the key product risks, please refer to the product brochure and policy documents. If there is any inconsistency between the policy documents and this product summary, the policy documents shall prevail.
Notes:
- Based on a comparison of savings plans for new policies offered by insurers carrying on composite and long-term business in the register of authorised insurers authorised by the Insurance Authority, as at 12 April 2022.
- Expected total cash value is the sum of guaranteed cash value, expected cash value of non-guaranteed accumulated reversionary bonuses, and expected cash value of non-guaranteed terminal bonuses.
- Source: MSCI ESG Research, as at 31 March 2022.
- All new insured persons must have an insurable interest relationship with the then policy owner. The change of coverage option, change of insured person option and change of policy owner must meet the prescribed conditions under the policy terms and be subject to the then prevailing administrative rules, underwriting rules and other conditions, and are subject to approval by Sun Life. If the coverage term is extended due to a change of insured person/change of coverage, the guaranteed cash value amount after the original policy maturity date shall not be less than the amount before the change.
- The values of reversionary bonuses and terminal bonuses are non-guaranteed and are determined from time to time by the rules specified by Sun Life. Reversionary bonuses and terminal bonuses may change according to the performance of several experience factors, among which investment returns are usually regarded as the main determining factor. Other factors include, but are not limited to, claims experience, policy expenses, taxation and policy owner persistency experience.
- The upper and lower limits of cash withdrawals are subject to the prevailing administrative rules.
Disclaimer
- This information is provided by Sun Life for general reference only and does not take into account any individual needs and suitability, nor should it be regarded as sales advice. Before taking out insurance, you should discuss with a licensed insurance adviser to identify an insurance solution suitable for you, and refer to the information provided by the insurer.
- The premium information above is updated as at 6 October 2022 and does not include the levy collected by the Insurance Authority.
- Last updated on: 6 October 2022.
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.
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