Forever Love Coupon Plan 5

Our investment philosophy is to deliver stable returns in line with the product’s investment objectives and AIA’s business and financial objectives.

Our investment policy aims to achieve the targeted long-term investment results and minimise volatility in investment returns over time. It also aims to control and diversify risk exposures, maintain adequate liquidity and manage the assets with respect to the liabilities.

Our current long-term target strategy is to allocate assets attributed to this product according to the target asset mix on the asset class below:

• Bonds and other fixed income instruments: 65% - 85%
• Equity-like assets: 15% - 35%

Our investment strategy is to actively manage the investment portfolio i.e.: adjust the asset mix in response to the external market conditions. The proportion of equity-like assets would be lower when interest rate level is low and would be even lower than the long-term target strategy so to protect the guaranteed liability and to minimise volatility in investment returns over time, and vice versa when interest rate is high.

The bonds and other fixed income instruments predominantly include government and corporate bonds, and are mainly invested in the geographic region of the United States and Asia-Pacific (excluding Japan). Equity-like assets may include listed equity, mutual funds and direct / indirect investment in commercial / residential properties, and are mainly invested in Asia. Returns of equity-like assets are generally more volatile than bonds and other fixed income instruments. Subject to our investment policy, derivatives may be utilised to manage our investment risk exposure and for matching between assets and liabilities. 

Our currency strategy is to minimise currency mismatches. For bonds or other fixed income instruments,our current practice is to currency-match their bond purchases with the underlying policy denomination on best-efforts basis (i.e.: US Dollar assets will be used to support US Dollar liabilities). Subject to market availability and opportunity, bonds may be invested in currency other than the underlying policy denomination and currency swap will be used to minimise the currency risks. Currently assets are mainly invested in US Dollar. For equity-like assets, currency exposure depends on the geographic location of the underlying investment where the selection is done according to our investment philosophy, investment policy and mandate.

We will pool the investment returns from other long term insurance products (excluding investment linked assurance schemes and pension schemes) together with this participating insurance plan for determining the actual investment and the return will subsequently be allocated with reference to the target asset mix of the respective participating products. Actual investments (e.g. geographical mix, currency mix) would depend on market opportunities at the time of purchase. Hence it may differ from the target asset mix.

The investment strategy may be subject to change depending on the market conditions and economic outlook. Should there be any material changes in the investment strategy, we will inform policy owners of the changes, with underlying reasons and impact to the policies.

1. You should pay premium(s) on time and according to the selected premium payment schedule. If you stop paying the premium before completion of the premium payment term, you may surrender the policy, otherwise, the premium will be covered by a loan taken out on the policy automatically. When the loan balance exceeds the sum of guaranteed cash value and accumulated Annual Dividends with interest (if any) of the basic plan, the policy will terminate and you will lose the cover. The surrender value of the policy will be used to repay the loan balance, and we will refund any remaining value.
   
   
2. The plan makes certain portion of its investment in equity-like assets. Returns of equity-like assets are generally more volatile than bonds and other fixed income instruments, you should note the target asset mix of the product as disclosed in this product brochure, which will affect the dividends on the product. The savings component of the plan is subject to risks and possible loss. Should you surrender the policy early, you may receive an amount considerably less than the total amount of premiums paid.
   
   
3. You may request for the termination of your policy by notifying us in written notice. Also, we will terminate your policy and you / the insured will lose the cover when one of the following happens:
   • the insured passes away;
   • you do not pay the premium within 31 days of the due date and the policy has no cash value;
   • any benefit is paid under the basic plan or an add-on plan that triggers termination of the policy; or
   • the outstanding debt exceeds the guaranteed cash value of the policy. Where the premium is covered by a loan taken out on the policy automatically, the outstanding debt exceeds the sum of guaranteed cash value and accumulated Annual Dividends with interest (if any) of your policy.
   
   
4. We underwrite the plan and you are subject to our credit risk. If we are unable to satisfy the financial obligations of the policy, you may lose your premium paid and benefits.
   
   
5. You are subject to exchange rate risks for plans denominated in currencies other than the local currency. Exchange rates fluctuate from time to time. You may suffer a loss of your benefit values and the subsequent premium payments (if any) may be higher than your initial premium payment as a result of exchange rate fluctuations. You should consider the exchange rate risks and decide whether to take such risks
   
   
6. Your current planned benefit may not be sufficient to meet your future needs since the future cost of living may become higher than they are today due to inflation. Where the actual rate of inflation is higher than expected, you may receive less in real terms even if we meet all of our contractual obligations.
   

Accidental Death Benefit will not cover any conditions that result from any of the following:

• self-destruction while sane or insane, participation in a fight or affray, being under the influence of alcohol or a non-prescribed drug
  
• war, service in armed forces in time of war or restoration of public order, riot, industrial action, terrorist activity, violation or attempted violation of the law or resistance to arrest
  
• racing on wheels or horse, scuba diving
  
• ptomaines or bacterial infection (except pyogenic infection occurring through an accidental cut or wound)
  
• air travel, including entering, exiting, operating, servicing or being transported by any aerial device or conveyance (except as a passenger of a commercial passenger airline on a regular scheduled passenger trip over its established passenger route) 
  

The above list is for reference only. Please refer to the policy contract of this plan for the complete list and details of exclusions.

If the person protected under the policy commits suicide within one year from the date on which the policy takes effect, our liability will be limited to the refund of premiums paid (without interest) less any outstanding debt.

Except for fraud or non-payment of premiums, we will not contest the validity of this policy after it has been in force during the lifetime of the person protected under the policy for a continuous period of two years from the date on which the policy takes effect. This provision does not apply to any add-on plan providing accident, hospitalisation or disability benefits.

• You have the right to cancel and obtain a refund of any premiums and any levy paid by giving written notice to us. 
• Such notice must be signed by you and submitted to the Customer Service Centre of AIA International Limited at 12/F, AIA Tower, 183 Electric Road, North Point, Hong Kong or the Customer Service Centre of AIA International Limited at Unit 1903, 19/F, AIA Tower, 251A-301 Avenida Comercial de Macau, Macau within 21 calendar days immediately following either the day of delivery of the policy or the Cooling-off Notice to you or your nominated representative, whichever is the earlier.