QDAP Savings
5 Star Products

To encourage tax payers to plan and save for retirement, the government introduced the Qualifying Deferred Annuity Policy (“QDAP”) in 2019. If a deferred annuity product satisfies the Insurance Authority (“IA”)’s criteria on premium, payment period, annuity income period and disclosures, the insurance company may register the product as a QDAP.

The policyholder of QDAP can enjoy tax deductions on the premium. Both the product break-even year and the rate of return can be enhanced if tax savings are considered, particularly for policyholders with high marginal tax rates.

10Life has collected data on different QDAP products in the market. Based on the assumptions that the policyholder is a male at age 45, paying premium for 5 years (or nearest), 10Life actuaries have compared the guaranteed return, projected return and early surrender coverage, and also calculated the impact of tax deductions to the product return. 10Life rates products according to the market benchmark, with the best in class awarded as “5 Star Product”.

USD - QDAP (Savings)
In alphabetical order by company name
USD - QDAP (Savings)
In alphabetical order by company name
RetireFun Deferred Annuity Plan
Hang Seng Insurance
eIncomePro Deferred Annuity Plan (100% Guaranteed)
Sun Life
Foresight Deferred Annuity
Well Link Life
Well Enjoy Deferred Annuity Plan (Supreme)
YF Life
MY Deferred Annuity
How we rate QDAP products
As QDAP Savings is for savings, 10Life scores the products based on the product returns and early surrender coverage, with higher weight on guaranteed over projected return, as the latter consists of non-guaranteed amounts. By comparing the Present Value (PV) of the total premium to be paid and the total income receivable, we can compare the cash flow of different products and calculate the product scores.
Guaranteed Return (60%)
Projected Return (20%)
Early Surrender (20%)
What are the Insurance Authority (IA)’s criteria on QDAP?
  • Minimum total premiums of HK$180,000 and minimum premium payment period of 5 years
  • Minimum annuity period of 10 years
  • Annuity income to start at the age of 50 or above
  • Disclosure of Internal Rate of Return (IRR) of the product to allow evaluation and comparison
  • Clear presentation of the guaranteed and non-guaranteed annuity payouts
  • Clear separation of premiums of all riders (e.g. critical illness, hospitalisation cash, etc.) from the QDAP premiums

You may find the full details from <GL19: Guideline on Qualifying Deferred Annuity Policy> issued by IA.
How much is the tax saving?
Premium paid for QDAP is tax deductible up to a limit of HK$60,000 per year. The actual tax amount saved would depend on your marginal tax rate. For example, based on the prevailing highest tax rate of 17%, you may save up to $10,200 payable tax per year from buying QDAP.
What should I consider when choosing a deferred annuity?
An annuity product aims to protect the retirement life of the insured in the financial aspect. As you age your risk tolerance generally decreases, hence you shall focus on the guaranteed return and the longevity coverage of the annuity product. Some annuity products present attractive projected returns, but the non-guaranteed part is dependent on multiple factors including the market environment, investment performance, dividend policy, etc. and your retirement plans could be seriously affected if the non-guaranteed income is not as expected.
Would the Inland Revenue Department (IRD) recover my tax deductions if I surrender my QDAP early?
Under current arrangements, early surrender of policy would not make the tax deductions recoverable by the IRD. However, if you cancel the policy during the cooling-off period and have your paid premium refunded, you would need to pay back any tax deductions made.
10Life strives to use unbiased scoring methodologies to compare insurance products. We obtain public information of insurance companies from different sources and apply data analytics to derive scores and ratings. The information for reference only and does not take into account your personal needs or constitute any sales advice. You should seek advice from licensed insurance advisors before purchasing insurance products. 10Life may review and revise the scoring methodologies regularly to enhance the product comparisons. If you have any enquiries or suggestions on our scoring methodologies, please email us at enquiries@10life.com
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