Endowment Insurance, Insurance

Best Endowment Plan in Singapore

What is an Endowment Plan?

An endowment plan is a type of life insurance policy that combines savings and protection. It pays out either on death or when the policy matures. Due to its low life coverage component, one should not solely depend on an endowment plan for protection purposes. Singapore’s inflation rate is projected to be between 0.6%-1.47%* per annum from 2020-2024. It means that if your current investments are not yielding an amount that is higher than the inflation rate, the value of your savings is depreciating with each passing year.

Some short-term endowment plans have a term of 3 to 5 years, whereas long-term plans can have a term of up to 25 years to life. Short-term endowment plans are usually single-premium, where the premium is paid in one lump sum. Conversely, most long-term endowment plans require regular periodic premium payments throughout the duration of the plan.

There are two types of returns and bonuses from endowment plans, guaranteed and non-guaranteed. Guaranteed returns and bonuses will be as stated in the policy documents. However, non-guaranteed returns and bonuses will depend on the investment performance in the participating fund of the endowment policy.

What do you have to consider before getting an Endowment Plan?

Guaranteed Returns

Endowment plans generally come with some form of guaranteed returns unlike investing in the stock market. When you pay your insurance premiums regularly till the plan’s maturity, you will receive the guaranteed returns. Most endowment plans provide some form of insurance coverage as part of the overall benefit of the plan. Some regular investment plans do not provide any life insurance coverage, even when the intention of investment is for the future of a loved one. In contrast, endowment plans provide protection which guarantees the payout even in unfortunate events like death. As a result, endowment plans are popular among parents who desire to save and invest for their children’s education.

Short to Long Commitment Period

Endowment plans have a period of between 3 to 25 years where you have to stay committed to the policy. There is a penalty for early termination of your endowment plan. If you surrender your policy early, you may even get nothing back from your policy. Always seek advice when in doubt.

Insurance Coverage Component

A portion of your premiums will be paid towards the insurance rather than the investment itself. In hindsight, it might be better to seek other forms of investments if you are looking for pure returns without the added insurance benefits. Returns of an Endowment Plan are usually lower than open market stocks or ETFs, but they come at a lower risk compared to them.

Best Short-Term Endowment Plans:

Full insurer Endowment details may be found here:

Best Mid-Term Endowment Plans:

Full insurer Endowment details may be found here:

Best Limited Premium Payment Term Endowment Plans:

Full insurer Endowment details may be found here:

Case Study Illustrations:

For AIA Smart Growth II, it is suited for 

  • Young parents with children, intending to save for their education
  • Looking to save for retirement
  • Planning the holiday of a lifetime
  • Desire death and TPD coverage

For AIA Smart Wealth Builder, it is suited for 

  • Those looking for long-term savings
  • Prefer flexibility to withdraw money
  • Magnify the returns on savings
  • Lump-sum inheritance for the next generation

For Aviva MyWealthPlan, it is suited for 

  • Those looking to save for their children’s education needs
  • Looking to accumulate savings regularly in the medium to long term period’
  • Wish to have a capital guarantee upon maturity 
  • Seeking guaranteed and secured returns 

For Aviva MyLifeSavingsPlan, it is suited for 

  • Those looking to accumulate savings and retirement
  • Looking for a lower-risk investment product
  • Wish to have a capital guarantee upon maturity 
  • Want some potential upside

Claims & Contact Information
 Contact Information
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