Tiq 3-Year Endowment Plan: Etiqa's Short Term Endowment Plan with 1.68% p.a. Return
In the market for a short-term investment?
Have you ever considered an endowment plan like say…
Etiqa’s Tiq 3-Year Endowment Plan?
With a 3-year policy term and a guaranteed return of 1.68% p.a. ONLY if you hold it to maturity.
It doesn’t sound too shabby, huh?
Let’s find out more!
Disclaimer: We are NOT sponsored and this article does not constitute financial advice. We’re just sharing information here for YOU to make smarter financial decisions.
TL;DR: Is the Tiq 3-Year Endowment Plan Worth It?
The Tiq 3-Year Endowment Plan is a single premium, non-participating life insurance savings plan.
|Details||Tiq 3-Year Endowment Plan|
|Capital Guaranteed||From the start of the 3rd policy year|
|Premium||Single premium (one lump sum)
|Guaranteed Maturity Benefit||1.68% p.a.|
|Death Benefit||Pays 101% of your single premium upon your demise|
|Financial Assistance Benefit for COVID-19||Provides Hospitalisation, ICU, and Death benefits due to COVID-19|
|Policy Protection||Up to specified limits by SDIC|
|Credit Rating of Insurance Company||A|
Considering that the guaranteed return of 1.68% p.a. is higher than current fixed deposit promos and even the SSB.
It’s a product worth considering if you’re planning to put aside a minimum of $10,000 for at least 3 years.
The Financial Assistance Benefit for COVID-19 is also a nice touch, given this current climate that we’re in.
Note: this particular product is sold online without advice.
If you’re unsure if you should commit to such a product, I highly encourage that you seek proper advice from a certified financial advisor.
But if you already understand what you’re getting yourself into, and would like to buy this product…
What is an Endowment Plan?
An endowment plan is a life insurance policy which gives you a death benefit and helps you save at the same time.
Basically, you either pay regularly or make a lump sum payment (aka “single premium”).
In return, you get life insurance coverage.
Once your policy matures, you’ll be able to collect your principal plus any accrued interest.
Think of it as a hybrid between insurance and investing.
However, the insurance coverage an endowment plan provides is usually a little too basic to rely on.
Etiqa’s Tiq 3-Year Endowment Plan is a good example of a single premium endowment plan.
The Pros of Tiq 3-Year Endowment Plan
The issuance of the Tiq 3-Year Endowment Plan is guaranteed as no medical underwriting is required.
Your capital is guaranteed ONLY if you hold the endowment plan to maturity.
In return, you’ll get a guaranteed maturity yield of 1.68% p.a..
So assuming you pay a single premium of $20,000.
Three years later, you can receive a guaranteed maturity benefit of $21,024.
While the policy is in force.
You’ll enjoy a life protection benefit of 101% of the single premium.
Meaning if you paid the minimum premium of $10,000, and unfortunately meet your demise…
Your named beneficiaries will receive $10,100.
Yep, and this is why I mentioned earlier that if you’re looking to get adequate protection for your loved ones
You’ll want to consider more robust life insurance since this endowment plan only provides very basic coverage.
Financial Assistance Benefit for COVID-19
The one unique thing about this particular endowment plan is that you will also be eligible for Etiqa’s Financial Assistance Benefit for COVID-19.
|Description of Benefit||Maximum Days of Hospitalisation Benefit||Maximum Payout per Insured Person|
|Hospitalisation Benefit||If the Insured Person is hospitalised due to the contraction of the Novel Coronavirus (COVID-19), Etiqa will provide a hospitalisation benefit of $100 per day for stable condition, up to $1,000.||10||$1,000|
|Intensive Care Unit (ICU) Benefit||If the Insured Person is hospitalised and warded in the ICU due to the contraction of the Novel Coronavirus (COVID-19), Etiqa will provide an ICU benefit of $200 per day up to $1,000.||5||$1,000|
|Death Benefit||In the unfortunate event of the Insured Person passing away due to the contraction of the Novel Coronavirus (COVID-19), Etiqa will provide a lump sum death benefit of $50,000.||N.A.||$50,000|
This is a unique benefit that is applied to all existing and new life protection and insurance savings plan underwritten by Etiqa.
The Cons of Tiq 3-Year Endowment Plan
You’ll need to have $10,000 lying around to do this — and that’s not chump change.
You’ll notice that I’ve pointed out again and again that the guaranteed maturity benefit will ONLY be paid out if you hold the endowment plan to maturity.
Assuming you pay the minimum premium of $10,000:
|End of Policy Year||Total Premiums Paid to Date||Death Benefit|
This means that if you, for some reason, decide to surrender your Tiq 3-Year Endowment Plan before the end of your 3-year policy term.
You’ll incur a surrender charge and receive less than what you initially paid.
The takeaway here?
If you do decide to go with this endowment plan, make sure that you don’t need this sum of money for the next 3 years.
How Do I Apply?
If you fulfil the following criteria:
- You are a Singapore Resident with a valid NRIC or FIN; or
- You are foreigner with a valid Work Permit, Employment pass or Social pass.
- You are between age 17 to 70 (age next birthday)
Then it’s really simple.
Just head over to Tiq’s website where you can apply and manage your policy online.
Oh, and yes, you can choose to buy more than one policy.
How Do I Purchase the Tiq 3-Year Endowment Plan?
As mentioned earlier.
You can apply and manage your policy online on Tiq’s website.
You’ll need a couple of things like:
- Verification: Either via MyInfo or a photograph of your NRIC or FIN pass
- Proof of address: A copy of your bill or statements (for non-Singaporeans only)
You can pay via :
- DBS/POSB bank account
Note: it’s recommended that you pay via a bank account that matches the name of the policyholder
So… Should I Invest in the Tiq 3-Year Endowment Plan?
It’s not so much a ‘should you’ but more of a ‘can you’?
If you’re looking for a short-term, low(er) risk investment where you expect to use the money for say…
Then this is an option which you can consider besides fixed deposits and Singapore Savings Bonds.
However, if there’s a chance that you might need the money anytime before 3 years.
Then this is not an ideal option because you’ll have to pay a surrender charge and might get less than what you initially forked out.
In terms of insurance coverage…
If you’re looking to get this as protection for you and your family, it might be a little too basic for your needs.
As always, even though these endowment plans are only available on a first-come, first-served basis.
Take a moment to review your finances and needs before buying anything.
After all, you’re not going to buy something JUST because it’s available for a limited time only right…