Overview of DIRECT - GREAT Life II 70 with Optional DIRECT - GREAT Critical Care 70

Great Eastern Life has introduced DIRECT - GREAT Life II 70 with Optional DIRECT - GREAT Critical Care 70, a Direct Purchase Insurance (DPI) whole life plan designed for consumers seeking lifelong coverage without the involvement of a financial adviser. As a commission-free product, it offers basic, standardised protection against death, total and permanent disability (TPD), and terminal illness. The plan is structured as a participating policy, allowing policyholders to benefit from the performance of Great Eastern’s participating fund through declared bonuses, though these non-guaranteed elements are subject to market conditions. With a strong AA- credit rating from Standard & Poor’s, this product targets individuals looking for stable, medium-to-long-term returns alongside insurance protection, available until age 70 for premium payments and lifelong coverage thereafter.

How it compares

When evaluated on a common basis (age 35, male, non-smoker, per $100,000 sum assured), the DIRECT - GREAT Life II 70 presents specific trade-offs relative to its peers in the DPI whole life segment.

Premium Costs: The annual premium for this plan is $2,158. This positions it as a mid-range option within the comparison group. It is significantly more expensive than the DIRECT - HSBC Life Protector II Pay to Age 70 ($1,863), but notably cheaper than the DIRECT - AIA Whole Life Cover (II) ($2,710) and slightly lower than the DIRECT - China Life Whole Life Plan ($2,219). The HSBC plan offers the lowest entry cost, while AIA commands a premium price.

Surrender Values: After 20 years, the projected surrender value for this product is $28,200. This is comparable to the HSBC Life Protector II ($28,618) and slightly higher than the AIA Whole Life Cover (II) ($27,400). However, it is substantially higher than the China Life Whole Life Plan, which shows a much lower surrender value of $17,630 at the same horizon. This suggests that Great Eastern’s plan may offer better liquidity or cash accumulation in the medium term compared to China Life, while remaining competitive with AIA and HSBC.

Returns and Expenses: The 5-year net return is 2.39%, which is lower than AIA’s 3.10% but significantly higher than HSBC’s 1.16%. The 10-year net return stands at 3.68%, again trailing AIA (4.90%) but outperforming HSBC (3.28%). Notably, the Total Expense Ratio (TER) for Great Eastern is 1.54% over 5 years. This is higher than AIA’s efficient 1.30% TER but lower than HSBC’s 1.88%. China Life was excluded from the TER comparison as data was not provided in the table, though its net return data was also incomplete for the 10-year mark.

Pros

• Competitive Surrender Value: Offers a higher projected surrender value after 20 years ($28,200) compared to China Life and is on par with HSBC and AIA.
• Strong Insurer Backing: Supported by Great Eastern’s AA- credit rating and its status as part of the OCBC Group, providing stability.
• Balanced Cost Structure: The premium ($2,158) is lower than AIA’s offering while maintaining robust return potential (3.68% at 10 years).
• Flexible Bonus Structure: Includes both reversionary and terminal bonuses, allowing participation in fund performance.

Cons

• Lower Long-Term Returns vs. Leader: The 10-year net return of 3.68% is notably lower than AIA’s 4.90%, which may appeal more to those prioritizing maximum projected growth.
• Higher Expenses Than AIA: With a TER of 1.54%, it is less cost-efficient than AIA’s 1.30%.
• No Guaranteed Insurable Option: Lacks the feature to increase coverage without further underwriting upon life events, limiting flexibility for future needs.
• Limited Payment Flexibility: Does not allow SRS or CPFIS premium payments, restricting funding sources compared to some competitors.

Who it may suit

This product is well-suited for risk-averse consumers who value the stability of a large insurer like Great Eastern and seek a balance between cost and surrender value. It may appeal to those who find AIA’s premiums too high but are unwilling to accept HSBC’s lower projected returns or China Life’s significantly weaker surrender values. It is ideal for individuals comfortable with non-guaranteed bonuses and who do not require SRS/CPFIS payment options or guaranteed insurability features.

This is general information based on CompareFIRST.sg data, not financial advice. Premiums and features can change; please verify with the insurer or a MAS-licensed financial adviser before making any decision.