Canadian-based financial services firm Manulife has rolled out a “tax-deductible” qualifying deferred annuity policy (QDAP) in Hong Kong to provide customers with more options for retirement planning.
ManuWise Deferred Annuity (ManuWise) is certified by the HK regulator Insurance Authority.
Deferred annuity is an annuity which commences only after a lapse of some specified time after the final purchase premium has been paid.
Rise in interest
In addition to tax benefits, ManuWise aims to provide customers with a “secure retirement supported by a stable stream of income”.
The total projected internal rate of return (IRR) could range from 2.47% to 4.10%.
Wilton Kee, chief product officer for individual financial products at Manulife Hong Kong, said: “Thanks to the government’s launch of a tax deduction policy for qualifying deferred annuity premiums, we’re glad to see a rise in public interest in annuities as a retirement planning tool.
“Our recent survey revealed that more than 30% of respondents are interested in deferred annuity products, with tax deductible benefits being the key incentive.
“As a customer-centric insurer, Manulife is committed to offering a wide range of savings and retirement solutions catering to different needs at different life stages.
“As part of that comprehensive offering, ManuWise is designed to encourage people to step up their retirement savings for future needs.”
Features
Designed to support customers in building their retirement reserves, ManuWise offers the following features:
- Tax benefits: By taking up ManuWise, customers can be entitled to a tax deduction for their qualifying deferred annuity premiums up to a maximum limit of HK$60,000 (£5,900, $7,600, €6,800) per assessment year per taxpayer;
- Steady income: Customers can choose a premium payment term of five or 10 years. Once all premiums are paid up, they will start receiving a monthly annuity income for 10 years or 20 years. This income is comprised of a guaranteed portion, which is stable throughout the annuity income period, and a non-guaranteed portion which is determined by annual dividends built up in the policy. Alternatively, customers can leave their guaranteed and non-guaranteed annuity incomes with Manulife to earn interest;
- Critical illness cover: If the life insured is diagnosed with a critical illness, namely cancer, stroke or heart attack, during the annuity income period, customers who choose a ManuWise plan with a premium payment period of 10 years will be offered advances of future guaranteed annuity income as immediate cash;
- No Medical examination: No examination is required, and no health questions need to be answered by customers who sign up for the ManuWise plan; and
- Premium holiday: Customers may take a premium holiday for up to two years at any time after the second policy anniversary, during which all premium payments and policy values will be frozen.
