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3 Best Investment-Linked Plan or 101 Wrappers in Singapore

Investment-linked Insurance Plans (ILP) provides you with the opportunity to leverage the gains in the financial markets and provide life insurance coverage to take care of your loved ones. In this article, we present some investment-linked plans or “101 Wrapper” that may help you meet your investment and savings objectives.

However, before we begin, we would like to address the social stigma of ILPs in general.

Are ILPs bad?

There is no straight forward answer to this because Investment-Linked Plans by itself is a category of life insurance products. By implying ILP is bad, is similar to saying “universal life insurance is bad”, or “whole life insurance is a scam”, or “buying term life insurance is a waste of money”

The notion of ILP came about when people were unhappy with par fund returns of life insurance policies and wanted more flexibility and control. Therefore, Insurance companies decide to give people more flexibility. The biggest problem with ILP is that the cost of insurance rises steeply in the later years of the insured’s life. Thus, if the cost of insurance continuously supersedes the returns of the underlying investments each year, the cash value may actually deplete to a stage where one may eventually lose their coverage even as they continue to pay their premium diligently.

More recently, we are starting to see the emergence of a different type of ILP which is primarily marketed as an investment product by agents, bankers and financial advisors. They are typically known as the “101 wrapper”; such plans provide a death coverage of 101% of the total premiums paid, or in other words, not much insurance coverage. Technically, such a plan does not entirely mix investments with insurance but provides a value-added preposition of capital guaranteed upon the insured’s death regardless if the price of the investments drops below the principal.

Principal Guaranteed, Upon Death

As stated above, the main benefit of this product is the provision of death coverage whereby your principal will be guaranteed upon your death and not while you are alive and decides to terminate it after or within the policy term.

Locked Up Portion

One must take note that such plans requires a part of your investments, usually termed as “Initial Unit Allocation” to be locked up for a selected number of years. These monies cannot be withdrawn unless you wish to surrender or terminate the policy.

We select the 3 Best Investment-Linked Insurance/101 Wrapper Plans base on 3 basic criteria:

  • 101% Principal Guaranteed upon Death
  • Provision of start-up and loyalty bonuses
  • Multiple premium commitment options

Best Investment-Linked Plan for Immediate Dividend Payout

best investment linked policy in singapore

Manulife InvestReady Wealth (II)
Primary Charges

Admin Fee – 0.7% p.a. (Charged Monthly)

Supplementary Fee – 1.8% p.a. (Charged Monthly on the first 10 years)

Charges exclude fund management fees, cost of insurance, and early surrender fees and other partial withdrawal fees.

Few things to take note

Currently, the Manulife InvestReady Wealth (II) is the only product that pays dividend; the plan allows the policy owner to start receiving dividends paid out from dividend funds the month after the plan is forced. The plan has two types of Minimum Investment Period (MIP) schemes, the “normal MIP” which has a premium paying option of 3, 5 or 10 years, and the “Flexi MIP” which has premium paying option of 3,10 and 20 years.

The main difference between these two schemes is that the normal MIP requires the payer to pay the same exact premium throughout with penalty for reduction of premium whereas the “Flexi MIP” scheme allows the payer to adjust their premium to a minimum amount after a certain premium payment term without any penalty. E.g. if a 3 years “Flexi MIP” is selected, the payer can choose to reduce the premium committed on the second and third year to the minimum required amount.


What we like
  1. Dividend pay-out option – Unlike other products on this list, the Manulife Invest Ready Wealth (II) gives you the option to cash out the dividends if dividend-paying funds are selected. You may also choose to reinvest these dividends. Whichever option you choose, the availability of this alternative makes this option more liquid and provides you with money for an unforeseen emergency without suffering any additional charges.
  2. Provision of optional premium waiver add on – For extra premiums, this plan can give you benefits such as optional critical illness waiver coverage, cancer waiver coverage, or payor benefit. Apart from receiving basic death benefits, these optional add-ons can be a great way of insuring yourself against certain critical illnesses. Such add on will waive your premium upon the insured event you decide to get covered for.
  3. Flexible premium options and Bonuses – By providing you the option to choose from 3, 5, 10 and 20 years of premium term as well as having a flexible premium feature removes the struggle of having overcommitted for this plan, if the Flexi Plan was selected, the payer can choose to reduce the premium amount after a certain years. Start-up bonuses are also offered to individuals who can commit to a longer premium payment term, e.g. a 60% first-year start-up bonus is offered to a premium payment term of 20 years with a minimum premium of $9600/year with terms and conditions attached.
What we don’t like
  1. Lack of Accredited Investors (AI) Fund – One of the draw of such plans is the accessibility of AI funds by retail investors. Manulife draws funds availability from a suite of retail funds which are readily available in banks and investment platforms like IFAST and Philip Capital
  2. Additional Charge for Change in Life Assured – Apart from administrative charges, supplementary charges, surrender charges, partial withdrawal charges, premium shortfall charges and management charges. Manulife also charged additionally in case you ever decide to change the life insured, as of now there will be an additional $100 levied at the time of change.

Best Investment-Linked Plan for bonuses

best investment link plan in singapore

AXA Wealth Accelerate
Primary Charges

Account Maintenance Fee – 3.4% p.a. (on Initial Unit Account during Minimum Investment Period, deducted monthly)

Investment Management Fee – 1.0% p.a. (Charged on the whole amount including IUA as long as policy is in forced, deducted monthly)

Charges exclude fund management fees, cost of insurance, and early surrender fees and other partial withdrawal fees.

Few things to take note

The AXA Wealth Accelerate has a Minimum Investment Period (MIP) option of 10, 15, 20, 25 and 30 years. The basis for this MIP is that the policy has to be inforced and continuously paid for. During the MIP, an early encashment charge for non-premium payment or early surrender will be applied; the plan does provide a premium holiday option which can be exercised for up to 60 months aggregated throughout the policy term.

There is an initial contribution period (ICP) whereby bonuses will be allocated across 3 – 5 years dependant on the MIP selected. During the ICP Period, neither premium holiday nor partial withdrawal can be exercised. Partial withdrawal may be exercised during the MIP with a 7% charged on the amount to be withdrawn. 


What we like
  1. Generous bonus allocations – AXA Wealth Accelerate provides plenty of benefits which makes it come out on top of other competitors. Firstly, the customer has the possibility of receiving a start-up bonus of up to 200% of annual premium across the Initial Contribution Period (30 years MIP). In addition, you can also receive a power-up bonus of up to 1.3% p.a. of account value from policy year 15 to end of minimum investment period (depending on your choice, could be 20, 25 or 30 years) . Moreover, you also receive a loyalty bonus of up to 1.1% p.a. of account value throughout the policy term after the end of minimum investment period.(10,15, 20 , 25 or 30 years).
  2. Life replacement option – AXA Wealth Accelerate provides you with the flexibility of replacing the life assured to your spouse or child. This flexibility helps you pass on the benefits of this policy to your loved one once you realise that you’re not in the situation to any longer derive the best possible utility.
  3. Premium Reduction and Premium Holiday Feature – AXA Wealth Accelerate allows the policy owner to exercise a premium holiday clause after the Initial Contribution Period (ICP) typically 3 to 5 years depending on the policy term. The premium holiday feature allows the policy owner to stop contributing to the plan for up to 60 months, the plan also allows premium reduction of up to 25% of the original premium commited.
  4. Access to Accredited Investors Funds – The AXA Wealth Accelerate allows retail investors to have access to Accredited Investor (A.I) Funds such as Fundsmith SICAV & Pictet. Such funds are not accessible regardless of platforms for retail investors. This means that as a retail investor, you will automatically be granted access to AI funds through the wrapper functionality of the plan.

What we don’t like

  1. No options of receiving dividend pay-out – Unlike Manulife, AXA doesn’t offer an option of choosing dividend-paying funds. This can be a serious consideration because of the various benefits that dividend-paying funds provide in terms of liquidity. The only way to en-cash without charges is after the Minimum Investment Period, or else, a 7% withdrawal charge will be levied during the MIP period on the amount withdrawn.
  2. Lack of health coverage options beyond terminal illness – Unlike Manulife which offers you the flexibility of adding optional add ons to cover you against many other critical illnesses, AXA’s policy’s coverage mainly stems from death benefits and terminal illnesses.
  3. Longer Minimum Investment Period – This means the minimum lock-in period for this plan is 10 years, other 2 policies offers a shorter MIP or premium payment term which allows for client with short term commitment capability to invest. However, with the 5 years premium holiday option, investors can essentially take away 5 years from all premium payment term.

Best Investment-Linked Plan for Flexibility

Best Investment linked insurance policy

TM Atlas Wealth
Primary Charges

Initial Charge – 4% p.a. (on Initial Unit Account throughout premium payment term, deducted monthly)

Policy Charge – 1.5% p.a. (Charged on the whole amount including IUA as long as policy is in forced, deducted monthly)

Charges exclude fund management fees, cost of insurance, and early surrender fees and other partial withdrawal fees.

Few things to take note

The TM Atlas Wealth is the most flexible 101 Wrapper plan in the market, the only portion which is subjected to surrender charges will be the Initial Unit Account which is the first 12 months premiums paid. Subsequent premium/unit allocation will be flexible and can be reduced, withdrawn and remain unpaid as long as the minimum policy value remaining in the funds are above $3,000. Options of 5/10/15/20/25 premium terms are available and will determined the amount of start-up bonuses allocated.


What we like

  1. Premium Flexibility & Liquidity – With the exception of the IUA (Initial Unit Account) which is the first 12 months premium, liquidity of the product begins from the 13th This means you may stop premium payment, make partial withdrawal, take unlimited premium holidays or even reduce your subsequent premiums to the minimum amount without any extra charges. However, this will affect the initial bonus units and subsequent loyalty bonuses being allocated to your investment in the long run. Initial and Policy charges will continue to be levied from the funds
  2. Multi-currency limited pay investment option –TM Atlas Wealth increases this flexibility by providing you with the option to invest in multiple currencies investment funds such as Australian dollars, British pound(GBP) , US Dollar, , Euro and SGD. This can provide you with greater options to choose from and potentially may increase your returns depending on market performance.
  3. Multiple lives assurance – TM Atlas wealth goes beyond Manulife and AXA in offering you the option to add, remove or change life assured for up to 4 lives and up to 2 policy owners. This flexibility helps you share the benefits of this policy with your loved ones and cover almost a typical family.
  4. Access to Accredited Investors Funds – The TM Atlas Wealth allows retail investors to have access to Accredited Investor (A.I) Funds such as Fundsmith & Baillie Gifford. Such funds are not accessible regardless of platforms for retail investors. This means that as a retail investor, you will cut through the red tapes and be automatically granted access to AI funds through the wrapper functionality of the plan.
  5. Competitive Break Even Yield  – Base on our research and understanding, even with the higher Initial Unit Account charges of the plan, the subsequent charges of 1.5% p.a. from year 2 plus the crediting of bonuses from year 1 – year 5 provides a competitive break even yield for TM Atlas Wealth even for 10 short years*. Below is the break even yield for TM Atlas Wealth depending on the monthly investment amount and investment horizon.

TM Atlas wealth breakeven yield source tokiomarine

What we don’t like

  1. Highest Initial Account Charges – With an annualised charge of 5.5% on the Initial Account Unit, the plan is essentially the most expensive in the market to maintain for the IUA portion of the funds. However, the flexibility of the plan, low subsequent charges and welcome bonuses starting from 4.5% more than compensate for the high charge levied on the first 12 months of investment made
  2. No Dividend Pay-out – Unlike Manulife InvestReady Wealth II, the plan does not provide the option of receiving dividends from dividend-paying funds, instead, the plan will allow the flexibility of partial withdrawal on the investment amount done from the 13th month onwards without subjecting to any early partial withdrawal charges.

Given these benefits and drawbacks, it’s advisable for you to choose a policy by keeping in mind your long term priorities and considerations. Do note that these plans do not provide principal guaranteed if you were to terminate them halfway or even after the minimum commitment period. Returns from these policies depend on market condition. There are various charges that one should note and should seek clarification from their agents or financial advisors before taking up the products.

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