Manulife Hong Kong launches tax-deductible deferred annuity
Pre-retirees can enjoy tax concession benefits with flexible stream of retirement income
MANULIFE Hong Kong has launched ManuLeisure Deferred Annuity (ManuLeisure), a tax-deductible Qualifying Deferred Annuity Policy (QDAP) certified by the Insurance Authority. Targeting young and middle-aged pre-retirees, ManuLeisure helps customers enjoy tax concession benefits while offering a flexible and self-scheduled stream of retirement income. The total projected internal rate of return (IRR) could range from 3.85% to 4.30%.
Wilton Kee, chief product officer for individual financial products at Manulife Hong Kong, says “Based on our recent survey, we are glad to see a surge in public awareness in annuities as an extra means of savings, with 50% of respondents being aware of the product compared with 28% from previous finding earlier this year. Nearly 40% of respondents said they were likely to purchase a deferred annuity product as a retirement planning tool, 6 percentage points more than earlier this year.”
Kee adds, "Riding on the increased public interest and the positive response towards tax-deductible deferred annuity policy, we have designed a new comprehensive plan to encourage young and middle-aged customers to step up their retirement savings starting from as low as the age of 18 to leverage future potential retirement income while they save for tax. We understand that customers want to pick and choose with flexibility and we want to empower them with options that suit their own needs.”
A wide issue age ranging from ages 18-60 is designed to support customers in building a steady retirement income stream. And by taking up ManuLeisure, customers can be entitled to a tax deduction for their paid qualifying deferred annuity premiums up to a maximum limit of HK$60,000 per assessment year per taxpayer.
Once the customers have reached the annuity start age of their own choice, at either age 55, 60, 65 or 70, they can start receiving a monthly annuity income until age 85. 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 dividends built up in the policy. Alternatively, customers can leave their guaranteed and non-guaranteed annuity incomes with Manulife to earn interest.
During the annuity income period, if the life insured is diagnosed with a critical illness, namely cancer, stroke or a heart attack, advances of future guaranteed annuity income as immediate cash will be offered to ease financial worries.
No medical examination is required, and no health questions need to be answered by customers who apply for the ManuLeisure plan, and 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 guaranteed cash value will be frozen.
Customers may be entitled to a terminal bonus in the event of policy termination, such as, the life insured passes away, is diagnosed with a critical illness, or customers choose to end the policy early.
If the life insured passes away due to an accident in the first 5 policy years, an additional accidental death benefit will be offered to their loved ones to help relieve the financial hardship they face.
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10 Oct 2019