This is a participating insurance plan designed to be held long term. Your premiums will be invested in a variety of assets according to our investment strategy, with the cost of policy benefits and expenses deducted as appropriate. Your policy can share the divisible surplus (if any) from product groups determined by us. We aim to ensure a fair sharing of profits between policy owners and shareholders, and among different groups of policy owners.
Future investment performances are unpredictable and we are here to help smooth out the bumps. Through our smoothing process, we aim to deliver a more stable bonuses payment by spreading out the gain and losses over a longer period of time. Stable bonuses pay-out will ease your financial planning.
We will review and determine the bonus amounts at least once per year. The bonuses declared may be different from those illustrated in any product information provided (e.g. benefit illustrations). In case of any change in the actual bonuses against the illustration or should there be a change in the projected future bonuses, such changes will be reflected in the policy anniversary statement.
To determine our policy bonuses, we consider both past and future outlooks for all the factors including, but not limited to, the following:
Investment returns: include both interest earnings and any changes in the market value of your product’s backing asset. Depending on the asset allocation adopted by the product, investment returns could be subject to fluctuations in interest income (both interest earnings and outlook of interest rate) and varied market risks, including credit spread and default, equity price, property price and currency price of the backing asset against your policy currency.
Claims: include the cost of providing death benefit and other insured benefits under the product(s).
Surrenders: include policy surrender and partial surrender; and the corresponding impact on investment.
Expenses: include both expenses directly related to the policy (e.g. commission, underwriting, issue and premium collection expense) and indirect expenses allocated to the product group (e.g. general overhead costs).