I previously signed up for Great Eastern GREAT205 in 2017 with my Supplementary Retirement Sum (‘SRS’) funds. As it was a 3-year endowment plan, I received the full maturity benefit of 106.33% (inclusive of Maturity Benefit, which is 100% of the single premium) when the policy reached maturity in late 2020. After that satisfactory experience, I remain on the hunt for investment solutions with similar risk-reward profile to put my idle SRS funds to better use. This led me to Great Eastern (‘GE’) GREAT SP Series 3 which was launched on 29 March 2021. Here is my review of GE 3-Year Online Endowment Plan: GREAT SP SERIES 3.
What Is GREAT SP Series 3?
Great Eastern, a member of the OCBC Group, is the oldest and most established life insurance group in Singapore and Malaysia. It has launched GREAT SP Series 3, an online, single premium non-participating plan with a guaranteed yield at maturity of 1.55% per annum. This plan also provides coverage against Death and Total and Permanent Disability. It is primarily designed to help new and existing customers on their short term wealth accumulation goals.
What Are The Features of GREAT SP Series 3?
Premium Amount
GREAT SP Series 3 is a single premium policy and the minimum premium amount starts from $10,000. The low quantum is ideal as it puts it within reach of more mass retail investors.
Short Tenure
As a 3-year endowment plan, the lock-in period is relatively short. This offers reasonable liquidity to the policyholder. For instance, parents who foresee that they would require to utilise their children’s education funds in only 3 to 4 years’ time may find GREAT SP Series 3’s short-term commitment suitable to their financial needs.
Attractive Returns
While returns are guaranteed at 1.55% per annum, it is possible to juice it up slightly by reinvesting the annual guaranteed payouts. Policyholder can do so by selecting the Accumulation Option, which is 1 of 2 types of payout options as shown in Diagram 1.
Diagram 1: Compare payouts between (i) Paid-out option and (ii) Accumulation option*
*The figures used above are for illustrative purposes only and are subject to rounding. Please refer to the Policy Illustration for exact figures.
If policyholder selects the (i)Paid-out option, policyholder will receive a guaranteed payout of 1.55% of the single premium at the end of each of policy years 1 to 3. If policyholder selects the (ii) Accumulation option, the annual guaranteed payouts will be reinvested to generate additional non-guaranteed interest. Diagram 2 shows the math* behind the accumulation option for those who are curious.
Diagram 2: How the interest is calculated for Accumulation Option assuming premium of $100,000
*The figures used above are for illustrative purposes only and are subject to rounding. Please refer to the Policy Illustration for exact figures.
By assuming the prevailing accumulation interest rate of 3.00%*, the illustrated yield at maturity is juiced up to 1.57% p.a. for the Accumulation option. The maturity benefit of 104.79% (inclusive of Maturity Benefit, which is 100% of the single premium) will be paid out at the end of the 3-year policy term, provided that the insured survives at the end of the policy term, with no policy alterations or claims made during the entire policy term.
Payment Modes
There is a plethora of options such as cash and SRS to fund the one-time premium of GREAT SP Series 3. Application can be made online securely on this URL from the comfort of your couch. Payment is conveniently processed via online: eNETs, AXS, bank transfer, PayNow QR. Alternatively, you can also purchase this endowment plan via your financial advisor, although the minimum premium amount varies by entry age and payment method. Regardless, these payment options make GREAT SP SERIES 3 easily accessible to the retail investors.
Moreover, it is a fuss-free application with no medical check-up required.
Capital guaranteed
The capital of your GREAT SP Series 3 is 100% guaranteed at maturity. Plus, your policy is protected up to the specified limit under the Policy Owners’ Protection Scheme which is administered by the Singapore Deposit Insurance Corporation (SDIC).
Other insurance benefits
GREAT SP Series 3 provides protection against Death and Total Permanent Disability during the policy term. GE will pay 105% of the single premium, or the surrender value of the policy, whichever is higher, less any indebtedness under the policy. Please refer to the product summary for the full details of these benefits.
Conclusion
Interest rates have plunged to historical lows as major economies embarked on expansionary monetary policies to combat the economic fallout from the Covid-19 pandemic. Singapore is not spared either; 1-month SIBOR has plunged to 0.28% while 3-Year Singapore Saving Bond returns 0.41% p.a. That is why the interest rate offered by GREAT SP Series 3 should be viewed holistically and considered in today’s volatile environment.
At guaranteed yield of 1.55% p.a. after 3 years, it makes GREAT SP Series 3 one of the better online endowment plans in the market considering the long-standing reputation of the offeror. Do note that GREAT SP Series 3 will only be available for a limited period on a first come, first served basis. Tranche is closing soon, apply online at http://sg.gelife.co/greatsp3by. Alternatively, you can also apply at OCBC branches or apply online at http://www.ocbc.com/GSP3
*Disclosure: This article is written in collaboration with Great Eastern. It is for information only and reflects my opinion and not that of Great Eastern. It is not financial advice and has no regards to any person’s investment and financial needs. Please seek advice from a qualified advisor for a suitable product. Past performance of a product is not indicative of its future performance. Great Eastern is not responsible to any person for this article including any unauthorised use of information. This is not an offer, recommendation or solicitation to buy or sell any products.
Precise terms, conditions and exclusions of products are in the policy contracts.
Protected up to specified limits by SDIC (applicable for Income products that fall under the Policy Owners’ Protection Scheme).
This advertisement has not been reviewed by the Monetary Authority of Singapore.
Information is correct as at 2 April 2021
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