[Wealth growth + retirement + legacy] Can one savings insurance policy fulfil three wishes?

As the head of the household, you shoulder the responsibility of caring for the whole family. Should any unexpected situation arise, you may be caught off guard at any time. In such circumstances, having a range of flexible options allows you to face an ever-changing future with composure. Sun Life Hong Kong Limited (“Sun Life”) has launched the Stellar Multi-Currency Plan (the “Stellar Plan”), which offers long-term savings and wealth growth potential, with a focus on investing in assets with strong ESG performance. It also provides currency conversion and flexible withdrawal options to help policyowners respond to life’s many changes. In addition, the policy split option offers wealth legacy features, bringing together wealth accumulation, retirement savings and wealth transfer in one solution to suit the needs of different life stages.

The future is always full of changes and challenges. To be well prepared for whatever comes your way, the more choices you have on hand, the more at ease you will be when dealing with them.永明永越 offers a currency conversion option¹, allowing you to easily convert into four currencies, including US dollars, Canadian dollars, Renminbi and British pounds, to meet your financial needs from time to time.

If the policy owner or the next generation later needs to live in Mainland China or overseas, this option can be used flexibly as needed. After the policy currency is converted, its guaranteed cash value, non-guaranteed dividends and future premiums will continue to be determined in the same way as for 永明永越's policies in the same currency, which is different from other products in the market.

Whether your family moves overseas or your children pursue their studies abroad, these major life events all require a degree of financial support. 永明永越 provides a flexible withdrawal option, allowing you to withdraw all or part of the cash value of accrued reversionary bonuses², so the policy owner can withdraw part of the policy proceeds as needed³, for example, as a children’s education fund.

In the process of transferring wealth, ensuring that the next generation can make proper use of it has always been an important issue. Trusts, wills and insurance are all common wealth transfer tools. Among them, wills and insurance generally can only transfer wealth to beneficiaries in a lump sum, making it more difficult to set the timing and method of transfer.

However, some savings insurance products have kept pace with the times and offer a range of death benefit payment options, allowing you to choose the payment time and method yourself, providing greater flexibility. Sun Life's Stellar offers 6 death benefit payment options⁴, including full lump-sum payment, full instalment payment, partial instalment payment, the market-first⁵ partial instalment payment until the beneficiary reaches a specified age, full increasing instalment payment and continuation option, helping ensure beneficiaries can make the most of the wealth.

The plan provides an option to appoint a contingent policy owner⁶. In the unfortunate event of the policy owner’s death, the policy will automatically be transferred to the contingent policy owner, ensuring that your policy is looked after reliably and safeguarding your wealth.

As life enters different stages, our thoughts and needs also change. Sun Life Stellar offers a range of policy options to suit these changes. These include a free policy split option⁷, allowing the policy owner to allocate policy value early for wealth transfer and pass on wealth seamlessly to designated family members.

The policy owner may also choose the continuation option^8,9 as a death benefit payment option under the policy¹⁰. Upon the death of the designated insured person, the original policy will end and a new policy will be established. The designated beneficiary may automatically become the new insured person under the policy, allowing the policy to be passed on to the next generation in the form of a new policy.

In the event of an unexpected incident or financial difficulties affecting the policy owner, Sun Life Stellar also provides a range of premium payment arrangements, including the premium holiday option¹¹, premium waiver benefit¹² and payer premium waiver benefit¹². Even if the policy owner faces situations such as unemployment, total and permanent disability, or death, they may apply as needed to defer one year’s premium payment, or even have future premiums waived, ensuring that the insured person continues to receive protection.

In addition, the plan also offers a change in protection coverage option¹³, allowing coverage for one person (individual life) or two insured persons (joint life)¹⁴. If joint life is selected, the policy may remain in force even if one of the insured persons unfortunately dies suddenly. The policy owner may also exercise the option to change the insured person an unlimited number of times as needed¹³.

ESG (Environmental, Social and Governance) investing has become increasingly popular in recent years. More and more investors are considering ESG factors as an additional perspective for assessing asset opportunities and risks. In fact, past market performance shows that assets related to the ESG investment concept have delivered better returns than traditional assets or indices. 

Sun Life Stellar adopts an ESG investment strategy, investing in assets that offer sustainable returns and relatively lower risk, including green bonds, renewable energy, energy transition and sustainable buildings. It also incorporates a framework from Sun Life or recognised third-party ESG data providers to screen fixed-income assets or equities issued by issuers with high ESG ratings.

This plan not only generates more stable returns, but also supports long-term wealth growth. From the 3rd policy year onwards, Sun Life Stellar provides a guaranteed cash value, delivering stable returns, together with two non-guaranteed bonuses – reversionary bonus¹⁵ and terminal bonus¹⁵ – enhancing the potential for wealth accumulation.

The cash value of the reversionary bonus becomes guaranteed once declared and will accumulate within the policy. It will be paid out when the policy owner withdraws the policy value, surrenders the policy, upon policy maturity, or when the mental incapacity benefit¹⁶ is paid. This is a relatively uncommon feature in the market.

Mr Si, as a pseudonym, took out 永明永越 (12-year premium payment term) at the age of 35, with an annual premium of USD 5,000, to achieve goals at different stages of life, including setting up an education fund for his newborn daughter (aged 0), preparing his own retirement savings, and passing on wealth in the future.

From now until 31 December 2023 during the promotion period, if you successfully take out 永明永越 and meet the specified first-year annualised premium requirement, you can enjoy a premium rebate of up to 86% of the first-year annualised premium. The first-year premium rebate offer is subject to terms and conditions. Please click here for details before applying.

Notes:
1. Only one currency conversion option may be applied for in each policy year. Once the currency conversion is approved, the policy year, policy maturity date, policy owner and life assured of the new policy after currency conversion will remain the same as those of the policy before the currency conversion, and there will be no cooling-off period for the policy after currency conversion. The notional amount of the policy after currency conversion must not be less than the minimum amount required under Sun Life’s then-current administrative rules. Once the currency conversion application has been approved and completed, it cannot be withdrawn or changed. The currency conversion option is subject to the company’s sole discretion and approval, and to the conditions set out in the policy documents.
2. The upper and lower limits of cash withdrawal are subject to the then-current administrative rules. The notional amount after withdrawal shall be subject to the minimum notional amount requirement for the corresponding premium payment term under the then-current administrative rules; however, after the end of the 5th policy year (for 2-year premium policies) / relevant premium payment term (for 6-year / 12-year / 18-year premium policies), the remaining notional amount must not be less than the minimum amount of US$500 / C$600 / £350 / RMB3,500.
3. Any withdrawal amount in excess of the cash value of accumulated reversionary bonuses will be deducted from the guaranteed cash value and the cash value of the terminal bonus, which will reduce the policy’s notional amount and be regarded as a partial surrender, thereby reducing the policy’s long-term value.
4. When exercising the death benefit payment option, the minimum death benefit amount and the then-current administrative rules, as determined by Sun Life from time to time, must be met.
5. The “first in the market” item is based on the services provided by Sun Life and the market conditions as at 31 July 2023, and compares new savings plans offered by insurers carrying on both composite and long-term business as recorded in the register of insurers authorised by the Insurance Authority.
6. The designated contingent policy owner option is subject to the conditions set out in the policy terms, the then-current administrative rules, underwriting rules and other conditions stated in the designated prescribed form, and its application must be approved by Sun Life.
7. Only one policy split option may be applied for in each policy year. Once the policy split is approved, the policy year, policy maturity date, policy owner and life assured of the split policy will remain the same as those of the original policy, and there will be no cooling-off period for the policy split. The notional amount of the split policy must not be less than the minimum amount required under Sun Life’s then-current administrative rules. Once the policy split application has been approved and completed, it cannot be withdrawn or changed.
8. If this option is exercised, the beneficiary must be an individual and still be alive.
9. If the beneficiary is able to meet Sun Life’s then-current administrative rules and other rules, when the new policy takes effect on the effective date of the continuation option,
a. the policy date and policy year of the new policy will remain the same as those of the original policy;
b. the policy maturity date of the new policy will be changed to the policy anniversary on or immediately following the 120th birthday of the new life assured;
c. the notional amount, total premiums due and paid, and the amount of any outstanding loans and interest, and the policy value of the original policy, including the guaranteed cash value, accumulated reversionary bonuses (if any) and terminal bonus (if any), will be allocated to the new policy at the specified percentage stated in the prescribed form for the relevant beneficiary;
d. the new policy will have no cooling-off period; and
e. for the purpose of calculating the applicable period under the incontestability clause, the relevant period for the new life assured will be recalculated from the effective date of the continuation option.
10. When exercising the death benefit payment option, the minimum death benefit amount and the then-current administrative rules, as determined by Sun Life from time to time, must be met.
11. (Applicable to 6-year, 12-year and 18-year premium policies only) The premium holiday option is subject to the conditions set out in the policy terms, the then-current administrative rules, underwriting rules and other conditions, and must be approved by Sun Life. Once the premium holiday is approved, Sun Life will not declare any face value or cash value of reversionary bonuses for the policy, and will maintain the guaranteed cash value and the face value and cash value of accumulated reversionary bonuses (if any) at the level immediately before the premium holiday period begins. For the definitions of the terms and full details of the terms and conditions of coverage, please refer to the sample policy document.
12. (Applicable to 6-year, 12-year and 18-year premium policies only) If the coverage selected is joint life, for the relevant premium waiver benefit, both life assureds must be aged 18 or above; for the relevant payer premium waiver benefit, one of the life assureds must be under 18, subject to Sun Life’s then-current administrative rules and approval.
13. The change of coverage option and change of life assured option are subject to the conditions set out in the policy terms. For details, please refer to the sample policy terms. For the definitions of the terms and full details of the terms and conditions of coverage, please refer to the sample policy document.
14. All new life assureds must have an insurable interest in the then policy owner. The change of life assured is subject to the then-current administrative rules, underwriting rules and other conditions, and must be approved by Sun Life. If the coverage period is extended due to a change of life assured / change of coverage, the amount of guaranteed cash value after the original policy maturity date shall not be less than the amount before the change.
15. The value of reversionary bonuses and terminal bonuses is non-guaranteed and is determined by rules set out by Sun Life Hong Kong Limited (“Sun Life”) from time to time. Reversionary bonuses and terminal bonuses may vary according to the performance of a number of experience factors, of which investment returns are generally considered the main determinant. Other factors include, but are not limited to, claims experience, policy expenses, taxes and policyholder surrender experience.
16. This benefit applies where: (a) when you apply for the designated mentally incapacitated benefit recipient, the policy owner and the relevant life assured must be the same person; (b) the proposed mentally incapacitated benefit recipient must be aged 18 or above; (c) proof of the proposed mentally incapacitated benefit recipient as specified in Sun Life’s then-current administrative rules must be provided; (d) any irrevocable beneficiary (if any) and assignee (if any) must consent in writing to the designation of (i) the mentally incapacitated benefit recipient and (ii) the percentage of the mentally incapacitated benefit.
When (a) a new mentally incapacitated benefit recipient is successfully designated and approved by Sun Life; (b) after a change of life assured, if the coverage is individual life and the policy owner is no longer a life assured, or if the coverage is joint life and the policy owner is no longer any one of the life assureds; (c) there is any change to the policy owner of this policy; (d) Sun Life receives notice of the appointment of a committee or receiver under the Mental Health Ordinance (Cap. 136 of the Laws of Hong Kong), or a committee or receiver appointed under similar laws in another jurisdiction; or (e) Sun Life receives notice that the policy owner holds an enduring power of attorney covering the policy, the existing designated mentally incapacitated benefit recipient will automatically be revoked.
If there is a dispute between the mentally incapacitated benefit recipient and any other person, including but not limited to the life assured’s guardian or receiver, attorney, beneficiary or assignee, or if Sun Life reasonably believes that such a dispute exists, Sun Life reserves the right to refuse payment of the mentally incapacitated benefit until the dispute is resolved.

Important notes: The above plan is subject to terms and conditions. For details of the product features, including risk disclosures and exclusions, please refer to the relevant sales brochure and sample policy document. Different products may have different features. Therefore, the above product comparison should not be used as a direct comparison between products or regarded as a comprehensive analysis. The above product comparison is for reference only. In the event of any inconsistency between this article and the policy document, the policy document shall prevail. This article is intended for distribution in Hong Kong and cannot be construed as an offer to sell, a solicitation to buy, or the provision of any product of Sun Life Hong Kong Limited outside Hong Kong. For details of the definitions and full terms and conditions, please refer to the sample policy document. Sun Life will provide the relevant documents upon your request.

The information in this article is provided by Sun Life and is for general reference only. It has not taken into account any individual needs or suitability and should not be regarded as sales advice. Before taking out insurance, you should discuss the insurance plan that suits you with a licensed insurance adviser and refer to the information provided by the insurer.
Last updated on: 13 November 2023.   

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.