Which illustrated policy benefits are guaranteed?
Hong Kong Insurance Connect: Separate guaranteed and non-guaranteed benefits in the illustration. A projected total is not a promised payout. Match the benefit type and policy year, then check contractual conditions. Checked on . [C1, C2]
Checked on · Public sources; general information, not advice.
Which document should I use when reading a proposal?
Ask for the insurer’s benefit illustration and the policy terms behind it, even if the material is called a proposal illustration or sits within a larger proposal. IA describes benefit illustrations for specified types of life policy as showing projected surrender values and death benefits at sale and while a policy is in force. Identify the prepared date, payment schedule and assumptions before relying on a total. [C1, C3]
How do I compare guaranteed values with projected totals?
Start with the intended policy year and the event involved: surrender, maturity where applicable, or death. Keep the guaranteed benefit separate from any projected non-guaranteed component. Ask which contractual conditions apply to the guarantee and whether the figure assumes continued premiums and no withdrawals. Early surrender can produce a substantial loss; a later death benefit does not establish cash available at an earlier exit. [C1, C2, C3]
Are all declared or illustrated bonuses the same?
IA distinguishes annual dividends, reversionary bonuses and terminal dividends. Annual dividends are generally fixed once declared, but interest earned if left to accumulate is non-guaranteed. A reversionary bonus has a face value payable on death and a discounted cash value on other termination. A terminal dividend can change with each declaration; its actual amount is determined when payable. Read the component, not just its label as a bonus. [C1]
Can a fulfillment ratio or IRR make projections certain?
No. A fulfillment ratio compares aggregate actual accumulated non-guaranteed benefits with the aggregate amounts illustrated at sale for the relevant policies. IRR expresses cash flows as an annualised rate. Neither turns future bonuses into guarantees. Ask for the cash-flow dates and the benefit basis behind a return figure, then use the linked IRR guide for the distinction. Have a licensed broker explain the illustration against your needs and holding period. [C1, C2, C3]
What do readers ask?
Is the illustrated total guaranteed?
Not if it includes non-guaranteed benefits. Read the components separately. [C1, C2]
Can non-guaranteed benefits be zero?
Yes. IA’s glossary describes that possibility under extreme circumstances. [C1]
Does a declared annual dividend fix its accumulation rate?
No. Interest on dividends left to accumulate is non-guaranteed. [C1]
Is a reversionary bonus’s cash value its face value?
IA distinguishes the death-benefit face value from a discounted cash value on other termination. [C1]
Is a terminal dividend fixed once illustrated?
No. Its actual amount is determined when it becomes payable. [C1]
Does a historical fulfillment ratio promise future returns?
No. It is historical information about non-guaranteed benefit delivery. [C1]
Can I use a death-benefit figure as surrender cash?
No. Match the figure to the event and policy year you are considering. [C1, C2]
Where can I read more or ask a process question?
What does IRR mean for a savings policy? What do fulfillment ratios measure? When does a savings policy break even? Country guides Trust checks Historical fulfillment ratios Life-stage hub Ask a general process question.
We provide information and referrals to a licensed Hong Kong broker; regulated advice and arrangements belong with that broker. Mainland visitors must sign in Hong Kong. Do not send identity, tax or medical documents through the general enquiry form. [C3]
General information, not advice.
Where are the sources?
Checked on . Public official sources; linked documents remain on their publishers’ sites.
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[C1] Insurance Authority — Glossary, benefit illustration, bonus types, fulfillment ratio and internal rate of return. https://education.ia.org.hk/en/tool/glossary.html
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[C2] Insurance Authority — Life insurance, participating benefits and early surrender. https://education.ia.org.hk/en/product/life-insurance.html
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[C3] Insurance Authority — Tips on buying insurance, contract review, risk disclosures and mainland visitor signing. https://education.ia.org.hk/en/faq.html