The Great Eastern Prestige Harvest policy is a U.S. dollar-denominated single-premium universal life insurance policy that combines protection and investment into one comprehensive plan.
This dual-benefit structure balances security and potential growth, making this policy a compelling choice for those seeking a robust financial planning tool.
Let’s take a closer look at the key points.
Criteria
- Minimum Entry Age 41
- Maximum Entry Age: 121
- Minimum premium: US$500,000
General Features
Premium Terms
With Great Eastern Prestige Harvest, you can either make a one-time single premium investment or distribute your premium payments regularly, ranging over a period of 2 to 10 years.
Additionally, the policy has specific premium payment terms designed to provide flexibility while maintaining a level of commitment:
- An initial planned premium is required at the time of policy issuance.
- Subsequently, premiums must meet the minimum requirements.
- Premium payments are acceptable if the total premiums received are equal to or less than the sum of planned premiums.
The minimum premium requirement is the total premiums you must maintain at each policy anniversary until the 9th policy anniversary.
Several factors influence this requirement:
- Age.
- Country of residence.
- Smoker status.
- Basic sum assured.
- Underwriting class.
- Gender.
If the minimum premium requirement is not met, the policy will lapse.
In such a case, you will be refunded your account value after deducting the surrender charge.
Policy Term
The policy term covers up to 121 years of age.
Protection
Death Benefit
In the unfortunate event of the insured passing away, the Great Eastern Prestige Harvest offers a death benefit to their beneficiaries.
The payout is determined based on 2 scenarios:
If death occurs before the policy anniversary following the Life Assured’s 121st birthday, the beneficiaries are entitled to receive the higher of:
- The account value, after deducting any policy debts or
- The sum assured.
If death occurs on or after the policy anniversary following Life Assured’s 121st birthday, the amount payable is the account value after deducting any policy debts.
The coverage starts from US$ 0.5 million, offering a significant safety net.
This safeguards your business from unexpected circumstances, guaranteeing its sustained growth and prosperity.
Terminal Illness Benefit
The Great Eastern Prestige Harvest also provides a Terminal Illness Benefit, ensuring even more comprehensive protection.
This benefit kicks in if the insured passes on within 12 months following the diagnosis of a terminal illness.
In such an event, the policy will pay a Terminal Illness Benefit up to a maximum of US $7,500,000.
It’s important to note that if the payout doesn’t completely reduce the death benefit, the policy will not terminate.
Instead, the account value and basic sum assured will be adjusted downward proportionally.
The policy continues to provide death coverage protection.
This means that even after a Terminal Illness Benefit claim, the policy remains active, offering continued protection to the insured.
Key Features
Single Premium Additions
Once you’ve completed your planned premiums under the Great Eastern Prestige Harvest, you can make additional single premiums (top-ups).
However, a few essential things to remember:
- Single premium additions are subject to approval.
- These single premium additions don’t increase your basic sum assured.
This means they will only contribute towards increasing the account value of your policy.
Partial Withdrawal
The Great Eastern Prestige Harvest provides the flexibility of making partial withdrawals, ensuring you can access your funds when needed.
However, certain conditions need to be adhered to:
- The minimum amount that can be withdrawn is US$1,000.
- After withdrawal, the remaining account value must be at least US$5,000.
- The sum assured post-withdrawal and applicable charges must be a minimum of US$500,000.
- All premiums paid post-withdrawal should fall within the minimum premium limits for the first 9 policy anniversaries.
For withdrawals made in the first 10 years of the policy, both your account value and basic sum assured will be reduced by the withdrawal amount, including charges.
If you withdraw from the 11th year onwards, your basic sum assured will only be reduced if the withdrawal amount exceeds the Free Partial Withdrawal yearly limit balance.
This limit is calculated as 5% of the account value at the start of the policy year minus the total amount withdrawn for that year (subject to a minimum of 0).
If the withdrawal amount is less than the Free Partial Withdrawal yearly limit balance, no charges will be applied, and your basic sum assured will not be reduced.
It’s important to note that there is no rollover for any unused portion of the Free Partial Withdrawal limit.
Total Surrender
The Great Eastern Prestige Harvest provides the option for complete surrender after the free-look period.
Should you choose to exercise this option, here’s what happens:
- Note that when payout is due, the amount owed will be based on the current value of your Great Eastern Prestige Harvest policy, with any surrender charges factored in.
- Any policy debts will be deducted from this surrender value.
After these deductions, you will receive the remaining balance.
Actual Credit Rate
Your policy’s account value is determined by a few factors, including the actual crediting rate, the premiums you’ve paid, and any applicable charges.
For the first 3 years following the Great Eastern Prestige Harvest policy issue date, the crediting rate is fixed with a guaranteed rate of 4.60% per annum.
After the initial 3 years, the actual crediting rate may fluctuate.
However, the guaranteed crediting rate is at least 1.50% per annum.
This guarantee ensures a minimum level of growth for your policy’s account value, regardless of market conditions.
In addition to the crediting rate, you are also entitled to a guaranteed loyalty rate.
This rate is 0.25% per annum for the Great Eastern Prestige Harvest policy through years 11 to 20 and increases to 0.275% per annum from policy year 21 onwards.
Premium Financing
Premium financing involves a bank loan to pay your premiums.
Here are some essential things you should know if you choose this route:
- If your policy premiums are financed through bank loans, you will lose ownership rights.
- The account value of your Great Eastern Prestige Harvest cannot be used to repay the credit facility or bank loan.
- The interest charge on the bank loan is separate from the Great Eastern Prestige Harvest policy’s crediting rate, meaning that it can end up being higher than the crediting rate under your Great Eastern Prestige Harvest policy, which could increase your financial burden.
- You are responsible for paying any accrued interest or cancellation charges on your bank loan until you fully settle the loan.
Policy Loans
After your Great Eastern Prestige Harvest policy has been active for an entire year and has accumulated a surrender value, you may be eligible to apply for a policy loan.
This means you can borrow against the cash value of your policy.
However, it’s important to note that taking out a policy loan can significantly impact your policy.
These potential impacts include:
- The outstanding loan amount may reduce the death benefit and terminal illness benefit payable.
- The account value of your policy may decrease by the amount of the loan.
- The surrender value, the amount you would receive if you decided to terminate the policy sooner, may also decrease.
Change in the Life Assured
You may request to change the Life Assured after the 1st policy anniversary.
If the policyholder is a corporation, there is no limit on the number of changes to the life assured because the policyholder and the life assured are 2 different entities.
For individual policyholders, only 2 changes are allowed.
The following conditions apply before you make any changes to the life assured:
- The policy has been in force for at least a year.
- The policy is single premium and non-premium financed or regular premium.
- In addition, you must not have outstanding planned premiums.
- The policy will accept the new Life Assured based on insurability.
- An administrative charge may be imposed when changing the Life Assured.
- The insurance charge, policy fee, minimum premium requirement, and surrender charge will depend on the new Life Assured’s details.
Revision of Basic Sum Assured
You can reduce the basic sum assured while the policy remains active, subject to the minimum sum assured.
This can only happen through a withdrawal.
However, you may not increase the basic sum assured.
Great Eastern Prestige Harvest Fees & Charges
Premium Charge
There’s a specific charge associated with your premiums:
- A premium charge of 9.65% is applied to your planned premiums.
- If you make any single premium additions, an 8.00% charge is applied.
These charges are deducted from your payments before adding them to your account value.
Policy Fee
The Great Eastern Prestige Harvest policy includes a monthly policy fee.
This fee is deducted from your account value at the beginning of each month.
It starts from the commencement of the policy and continues until the end of the 10th policy year.
The policy fee is based on your entry age when you start the policy.
It’s important to note that this fee is non-guaranteed and will not exceed 110% of the current policy fee.
Insurance Charge
The policy applies an insurance charge deducted from your account value at the beginning of each policy month.
This charge is based on your net sum assured, the amount your basic sum assured exceeds your account value.
Several factors can affect the insurance charge:
- Age.
- Gender.
- Smoker status.
- Country of residence.
- Underwriting risk class.
It’s important to note that the insurance charge is non-guaranteed and can change.
However, the insurance charge will not exceed 110% of the standard insurance charge rate.
Withdrawal Charges
The Great Eastern Prestige Harvest imposes withdrawal charges under certain circumstances.
These charges are applicable should:
- You withdraw from the policy within the first 10 policy years.
- From the 11th to 15th policy years, you withdraw an amount that’s more than the Free Partial Withdrawal Annual Limit Balance for that policy year.
In this case, the charge is applied to the partial withdrawal amount above the Free Partial Withdrawal Annual Limit Balance.
Surrender Charge
The surrender charge comes into play if you surrender your policy before its maturity date.
The calculation for the surrender charge is as follows:
Surrender Charge = Basic Sum Assured x Surrender Charge Rate (per US$1,000 of Basic Sum Assured).
For instance, if your basic sum assured is US$50,000 and the surrender rate is US$2 per US$1,000, your surrender charge would be US$100 (US$50,000/ US$1,000 x $2).
Illustration of How The Great Eastern Prestige Harvest Works
Jack, a 35-year-old entrepreneur, has wisely planned for the financial future of his family.
Married with 2 children, his goal is not only to protect their financial stability but also to ensure that he has enough funds for a comfortable retirement.
Before implementing his plan, Jack’s total estate was worth US$10 million.
He initially divides it equally – US$5 million for his retirement and US$5 million to be left as a legacy for his children.
To further enhance his estate, Jack decides to take out a 10-year regular premium Great Eastern Prestige Harvest policy with a sum assured of US$5 million.
This decision increased the total value of his estate to US$14 million.
This breakdown is as follows: US$9 million was allocated for his retirement, and US$5 million from the insurance cover will be divided equally between his children.
The total premiums for this insurance cover amounts to $1 million, which is a small price considering the significant increase in his estate’s value.
So, by strategically using the Great Eastern Prestige Harvest policy, Jack increased his estate’s value from $10 million to $14 million.
This smart move not only secures a comfortable retirement for himself but also ensures a substantial financial legacy for his children.
Summary of Great Eastern Prestige Harvest
| Cash & Cash Withdrawal Benefits | |
| Cash Value | Yes |
| Cash Withdrawals | Yes |
| Health & Insurance Coverage | |
| Death | Yes |
| TPD | No |
| Terminal Illness | Yes |
| Critical Illness | No |
| Early Critical Illness | No |
| Health & Insurance Coverage Multiplier | |
| Death | No |
| TPD | No |
| Terminal Illness | No |
| Critical Illness | No |
| Early Critical Illness | No |
My Review of the Great Eastern Prestige Harvest
The Great Eastern Prestige Harvest is a comprehensive universal life insurance plan designed for high net worth individuals.
Understanding the specifics is very important to make an informed decision.
Firstly, the policy provides substantial coverage against death and terminal illness.
Lifetime coverage starting from $0.5 million ensures financial support for your loved ones in case of unforeseen circumstances.
Peace of mind is one of the best advantages of this policy.
In terms of flexibility, the policy allows for partial withdrawals.
This feature can be helpful when you need immediate access to funds.
Furthermore, suppose you choose to surrender the policy due to unfortunate events or life plans.
In that case, this policy provides a financial exit strategy if your financial situation or needs change over time.
However, this policy has some drawbacks, which must be considered before committing to it.
These include:
- High premium charges especially considering that cheaper insurance products in Singapore charge less than 5%.
- There are no total permanent disability (TPD) benefits and optional riders for added protection and flexibility.
As always, It’s best to thoroughly understand what you’re purchasing. There might be alternatives in the market that has more features while charging lower fees.
This gives you more flexibility while increasing the potential to see higher returns on your policy.
As such, it’s best to get a second opinion and to explore alternatives from other insurers.
We partner with multiple financial advisors to help you with this.
Click here for a free non-obligatory consultation.
