AIA_platinum-legacy_sgWith decreasing interest rates in the past few years, universal life products were forced to reduce their crediting interest rates. Since the recent Fed’s hint of “tapering”, risk of increasing interest rates spooked the bond market.

Realistically speaking, rising interest rate is bad for most insurance products. your whole life policy, your endowment and your annuities all suffer due to strong sell off of the underlying bonds, at least in short term.

However, AIA chooses to increase their crediting interest rate from current 4.0% to 4.2% for their Platinum Legacy Plan now. This is because universal life operates in a different manner from traditional life insurance products. the return is largely determined by the underlying “tranches”.

If you would like to understand more about such products, please feel free to contact me. The promotion is till 30 Aug or when the tranche limit is reach.

About the Author

Ivan Guan is the author of the popular book "FIRE Your Retirement". He is an independent financial adviser with more than a decade of knowledge and experience in providing financial advisory services to both individuals and businesses. He specializes in investment planning and portfolio management for early retirement. His blog provides practical financial tips, strategies and resources to help people achieve financial freedom. Follow his Telegram Channel to join the FIRE community.
The views and opinions expressed in this article are those of the author. This does not reflect the official position of any agency, organization, employer or company. Refer to full disclaimers here.

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}