Wealth across generations: Ensuring lasting legacies through strategic planning
Indexed universal life insurance plans are emerging as essential tools for the ultra-affluent to securely transfer wealth to their descendants.
High-net-worth clients in Asia are seeking seamless solutions for efficient wealth transfer to the next generation. Photos: HSBC Life
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Amid an uncertain investment environment, Asia’s growing ranks of high-net-worth individuals (HNWIs) are seeking solutions for seamless wealth transfer to the next generation. According to the HSBC Quality of Life Report, this is one of the main goals for affluent clients when it comes to legacy planning.
“We are seeing an unprecedented level of wealth creation and intergenerational wealth transfer in Asia. An estimated US$2.5 trillion (S$3.3 trillion) is forecasted to be transferred to the next generation in Asia by 2030. Holistic financial planning must anticipate efficient wealth transfer to future generations,” said Mr Harpreet Bindra, CEO of HSBC Life Singapore. “Many younger HNWIs are starting their legacy planning journey earlier than their predecessors, and we are well-equipped to partner them on this journey.”
THE POWER OF INDEXED UNIVERSAL LIFE INSURANCE
Life insurance has long played a role in securing financial resilience for beneficiaries. With rising affluence, its role has expanded beyond protection to become a vital part of legacy planning for the next generation.
Insurance offers the flexibility and liquidity needed to equalise inheritance, provides extra funds through the death benefit and potentially increases the total value of assets. In addition, as not all assets can be easily divided and distributed, life insurance helps maintain harmony in legacy planning.
A more sophisticated version of this solution, the indexed universal life (IUL) plan, provides an even more flexible approach for wealth protection and accumulation. Mr Bindra explained: “IUL plans offer an opportunity to benefit from the performance of the underlying index. Furthermore, a floor in the crediting rate helps protect the policy value from market declines.”
HNWIs are recognising the dual advantage of solutions such as IUL plans: They safeguard wealth against unforeseen circumstances while facilitating the seamless transition of assets across generations.
In April, HSBC Life introduced the HSBC Life Diamond Prestige IUL in Singapore, offering whole life protection in the event of death or terminal illness. Policyholders also benefit from market upswings as the plan is linked to the performance of the underlying index such as the S&P 500.
“Whether clients are looking for more interesting options to grow their legacy or to diversify their portfolio as part of their succession plans, HSBC Life Diamond Prestige IUL is an efficient financial instrument for wealth transfer,” Mr Bindra said.
LOOKING AFTER YOUR PHYSICAL AND MENTAL WELL-BEING
Recognising the interconnectedness of physical, mental and financial well-being, HSBC Life aims to support customers in maintaining a lifestyle that boosts their well-being. To that end, the insurer has incorporated various wellness-related incentives into the plan.
These include a quit smoking incentive and a 1 per cent cost-of-insurance discount for 10 years if policyholders with conditions such as diabetes or high blood pressure improve their health before the third policy year.
“By incentivising our clients to adopt and maintain healthy lifestyles, we are taking a holistic approach to supporting them throughout their life journeys,” said Mr Bindra. “Our aim is for our customers to possess the well-being necessary to enjoy a good quality of life for themselves and their loved ones.”
A LEADER IN INSURANCE FOR HNWIS
HSBC has been investing in people, platforms and propositions to meet the wealth needs of its clients in Asia, with the aim of becoming the region’s leading wealth manager. A notable investment is the acquisition of AXA Singapore, which has significantly bolstered its insurance capabilities in the country. Through HSBC Life, clients now have access to a comprehensive range of insurance solutions covering health, protection, savings, wealth management, retirement and legacy planning.
Ranked second in the Agility WealthLens Brand Affinity Rankings 2023, HSBC Life Singapore is recognised as a leading HNW life insurer in Singapore.
“HNW and ultra-HNW clients have unique needs that require a high level of expertise to manage skilfully. Our experienced and dedicated HNW team is well-equipped to offer best-in-class support to our clients and distribution partners,” Mr Bindra shared. “We build strong relationships with distribution partners across diverse channels to ensure our insurance offerings are delivered with expert financial advice.”
To find out more about HSBC Life Diamond Prestige IUL and other legacy planning solutions, visit the HSBC Life website or speak to an HSBC Life financial planner.
Terms and conditions apply. Refer to the HSBC Life Diamond Prestige IUL product summary for more information. Underwritten by HSBC Life Singapore (Reg. No. 199903512M). Protected up to specified limits by Singapore Deposit Insurance Corporation. This advertisement has not been reviewed by the Monetary Authority of Singapore.
