Invest Flex TriVantage plan is a regular premium investment-linked plan (ILP) with a minimum investment period (MIP) of 10 years that offers several key benefits, including flexibility and potential for wealth growth. The plan falls under the category of 101-ILP whereby the death benefit is very much nominal. Micro improvements over time in this category do add up when compared to the first beginnings of the category.

Invest Flex TriVantage features elaboration:

• Premium Holiday: The plan allows for a premium holiday of up to 7 years, without charge, starting from the 3rd policy anniversary. This means you can temporarily stop paying premiums without incurring a fee, provided the policy value covers the ongoing charges.
• Potential Income Stream: You can opt to receive a potential income stream from the 1st policy year through dividend-paying funds. The dividend payouts are not guaranteed.
• Investment Maximization: The plan invests 100% of regular premiums from the start of the policy to purchase units in the chosen funds. This percentage increases to 102% after 10 years of premium payments and 105% after 20 years.
• Investment Bonus: You can receive an investment bonus of 15% of your regular premiums paid during the first policy year, which is used to purchase additional units. This bonus is applicable with a minimum annual premium of $48,000.
• Charge-Free Partial Withdrawals: During the MIP, you can make partial withdrawals without charge when specific life events occur, such as turning 65, purchasing a residential property, or hospitalization. The amount that can be withdrawn is limited to 10% of the prevailing policy value per life event, and there is a limit of 3 life event withdrawals during the policy term.
• Loyalty Bonus: A 0.5% annual loyalty bonus of the policy value starts from the 10th policy anniversary. This bonus is invested according to the chosen funds.
• Secondary Insured Option: The policy allows the appointment of a secondary insured, ensuring the policy continues in the event of the death of the primary insured.
• Death and Terminal Illness Coverage: The plan provides coverage for death or terminal illness. If death or terminal illness occurs within one year from the cover start date, the policy will pay the policy value less any bonus. After one year, the plan will pay 101% of net premiums paid or the policy value, whichever is higher.
• Flexibility: The plan offers flexibility with options to top up investments anytime, and switch between available funds without charge.
• Reduced Policy Fees: From the 11th policy year, the annual policy fee reduces from 2.5% to 0.5% of the policy value.
• Hassle-Free Application: The application process is designed to be hassle-free with no medical check-up required.

Invest Flex TriVantage notable points:

• Minimum Investment Period (MIP): The plan requires a minimum investment period of 10 years.
• Charges During MIP: During the MIP, charges apply for full surrender, reduction of premium and partial withdrawals.
• Surrender Charges: If the policy is surrendered fully, or the regular premium is reduced during the MIP, surrender charges will be deducted from the policy value. If the policy’s cash-in value is zero or less after charges are applied, no benefits will be paid, and the policy will terminate.
• Partial Withdrawal Charges: Partial withdrawals during the MIP incur charges, except when they occur due to specific life events.
• Premium Holiday Charges: A premium holiday charge may apply if the policy enters into a premium holiday during the MIP, before the third policy anniversary.
• Policy Fees: There is a policy fee applicable throughout the policy term, charged monthly by canceling units. This fee is 2.5% per annum of the policy value for the first 10 years, and 0.5% per annum from year 11 onwards.
• Insurance Cover Charge: An insurance cover charge (ICC) is deducted monthly starting from the 3rd policy anniversary. The charge is based on the insured’s age, gender, and sum at risk.
• Investment Risks: As an investment-linked plan, the policy value is not guaranteed and is subject to market risks. The value of the units in the ILP sub-funds and the income accruing to the units, if any, may fall or rise.
• Withdrawal Limitations: Partial withdrawals are subject to a minimum amount of $500 each time, with a minimum remaining policy value of $1,000 in aggregate across all sub-funds.
• Premium Limits: There are minimum premium requirements with a minimum regular premium of $4,000 per month, $12,000 per quarter, $24,000 half-yearly, or $48,000 yearly. There is also a minimum amount for top-ups and switches between funds.
• Policy Termination: The policy will terminate if the policy value is insufficient to cover applicable fees and charges, or if it is surrendered, or a claim is made due to death or terminal illness.

Invest Flex TriVantage Use Case:

Ivan’s Situation:

• Age: 50 years old
• Goal: Grow wealth for retirement and obtain protection
• Plan: Signs up for Invest Flex TriVantage with a 10-year minimum investment period (MIP)
• Annual Premium: $48,000
• Fund Choice: Chooses a dividend-paying fund with an illustrated potential payout of 6.5% p.a. and opts to receive payouts as monthly income.
• Coverage: Obtains death and terminal illness coverage.

Policy Progression:

• Age 50:
  • Receives a 15% investment bonus of regular premiums, totaling $7,200, to purchase additional units.
  • Receives a potential dividend of $3,553 in the first policy year, which he uses to fund lifestyle expenses.
• Age 53:
  • Makes a charge-free partial withdrawal of $10,000 to finance renovations for his new retirement home, utilizing the life events withdrawal benefit.
  • Has the option to take a premium holiday for up to 7 years at no charge, if needed.
• Age 60:
  • Continues to pay annual premiums after the MIP ends. The policy value is illustrated at $410,831.
  • Income Insurance invests 102% of his annual premium paid after 10 years. Also begins receiving an annual loyalty bonus of 0.5% of the policy value.
• Age 65:
  • Retires and stops paying annual premiums with an illustrated policy value of $644,083.
  • Continues to receive monthly dividends to supplement retirement expenses.
• Age 85:
• The illustrated policy value is $478,010, and total potential dividends paid would be $1,105,297.
• (In the event of Ivan’s passing, his family would receive a death benefit of $717,100, and the policy would terminate).

Key Benefits Demonstrated:

• Investment Growth: Ivan’s policy value grows significantly over time, with potential for both investment gains and dividend income.
• Flexibility: Ivan uses the plan’s flexibility to make a partial withdrawal for a life event and has the option to take a premium holiday.
• Income Stream: Ivan receives a potential income stream through dividend payouts, which supplements his lifestyle expenses and later his retirement.
• Loyalty Bonus: Ivan benefits from the annual loyalty bonus from the 10th policy anniversary onwards.
• Protection: Ivan is covered against death and terminal illness, providing financial security for his family.
• Investment Maximization: Ivan benefits from the increasing percentage of his regular premiums being used to purchase units, with 100% in the first 10 years, and 102% after the MIP ends.

Additional Notes:

• The figures presented are based on an illustrated investment return of 8% per annum and are not guaranteed.
• The policy also has a scenario illustrated at an investment return of 4%, where the illustrated policy value would be $384,065 at age 60 and $583,948 at age 65 with a total potential dividend payout of $536,164 by age 85.
• If the illustrated investment return was 4% p.a., Ivan would receive $2,167 in the first policy year, and his family would receive a death benefit of $717,100 if he were to pass away at age 85.
• Policy fees and other charges apply, which may affect the actual policy value and benefits received.
• The policy will terminate if the policy value is insufficient to pay applicable fees and charges.

Take note of the following in Ivan’s Case:

• Market Risk: The illustrated returns are not guaranteed, and the actual policy value may be less than the capital invested.
• Fees and Charges: Policy fees, insurance cover charges and other charges will apply and reduce the policy value.
• Surrender Charges: If Ivan had chosen to surrender the policy fully or reduce his regular premiums during the MIP, he would have been subjected to surrender charges.

Some things to note. This review post will get dated. And the product might not be available for new subscriptions at some point. Hopefully this serves as reference for future policyholders who have forgotten what they have taken up.

There can be shifts in planning narratives over time. For example, limited premium tenures gain popularity over the years because people are less confident of their future earning capacity or sustainability of income levels. Regular payout features gained popularity when more and more people are in tune with the FIRE (Financial independence retire early) movement. An extended period of low interest rates brought down insurance products’ returns yield for policy holders, but now in a higher interest rates environment, things have changed.

Income Invest Flex TriVantage may or may not fit into your financial plans. Understand that there is no best plan for all time, but there is a method to objectively facilitate your decisions. Read more about it here.

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