June 2023 - Portfolio Diversification with Life Insurance (English Only)
MARKETS SNAPSHOT
Market sentiments are mostly negative with the US Federal Reserve raising rates over the last 10 meetings, currently at 5.25%. Fear of bank failures and the impact of debt ceiling also weighed on sentiments and financial assets remain under pressure.
CREATING A MORE ROBUST PORTFOLIO USING LIFE INSURANCE
- Insurance solutions are much safer asset class and its mechanism of effective risk transfer has proved well over the last 2 centuries across different applications.
- Insurance policy’s cash value and sum assured act as a safety net and introduce flexibility options for clients.
- Insurance mechanism continues to play an important role in estate equalisation, legacy planning, wealth preservation, special needs planning and charitable giving.
CASE STUDY
Client’s Profile: Dato Kun, Age 55, Non-smoker, Death Coverage of US$20M
Dato Kun is married with children and bought a jumbo insurance policy in his early 40s. When the market plunged, the policy’s cash values (1) remained steady since there is a guaranteed portion and (2) continued to grow year-on-year. During the global financial crisis and even with the more recent market volatility, that put downward pressure on asset prices, his life insurance plan continued to remain a robust asset class of choice, to compliment his overall investment and wealth management strategy.
The policy provided him the flexibility to make withdrawals and policy adjustments when he encountered major changes in his life. This coverage gave him the comfort of knowing his assets were safe and his beneficiaries would not run into any predicament in the event of an unexpected demise.
*The information presented in this material is not exhaustive. Please refer to the Policy Illustrations, Product Summary, Bundled Product Disclosure Document (where applicable) and Policy Contract for the exact terms, conditions and specific details of the relevant insurance products. The information found in this material is for informational purposes only. It should not be used for sales presentations as they do not address your customers' specific and individualised needs, financial circumstances and investment objectives.
Disclaimer
We assume no responsibility or liability for any errors or omissions in the content of this material. The information contained in this material is provided on an “as is” basis with no guarantees of completeness, accuracy, usefulness or timeliness and without warranties of any kind whatsoever, expressed or implied. This is intended for educational/reference purposes and nothing contained in this material may be construed as investment, tax or legal advice in respect of any jurisdictions or counterparties. We strongly recommend an independent assessment of the specific legal, regulatory and tax consequences in relation to presented transaction. For internal business training only. Not for external distribution.