GREAT Index Income — A Market-Linked Endowment with Downside Protection

Overview

GREAT Index Income is a single-premium, non-participating endowment plan from Great Eastern Life that links its returns to the performance of the UBS Multi Asset Engle SGD Index — a diversified portfolio of S&P 500 futures, US 10-Year Treasury Note futures, and Gold futures. The plan runs for 9 years and pays a non-guaranteed yearly income benefit based on the index's 12-month rolling performance, with positive returns uncapped and a guaranteed minimum return of 0% p.a. for each segment. At maturity, you receive your standard single premium back plus the final yearly income benefit (if any). The plan also provides death and accidental death benefits of 101% and 105% of the standard single premium respectively.

How It Compares

At a common basis of age 35, male, non-smoker, with a $50,000 single premium, GREAT Index Income sits alongside three other single-premium endowment plans on CompareFIRST.sg.

AIA Retirement Saver (IV) offers a higher net return of 3.20% (5-year) and 4.90% (10-year), with a lower total expense ratio of 1.30% and a guaranteed surrender value of $51,480 at year 20. PRUActive Retirement II shows a 5-year net return of 2.32% but a higher TER of 2.27%, with a year-20 guaranteed surrender value of $46,732. RetireReady Plus (III) from Manulife has the highest TER at 2.40% and a year-20 guaranteed value of $49,055.

GREAT Index Income's illustrated yield to maturity is 2.00%–3.25% p.a., with a 5-year net return of 2.39% and 10-year net return of 3.68%. Its TER of 1.54% sits mid-pack. Notably, its par-fund net investment return has improved from 0.71% (3-year) to 3.68% (10-year), suggesting better long-term performance.

Pros

• Downside protection: Minimum 0% p.a. return per segment guarantees your premium is never eroded by poor index performance
• Uncapped upside: Positive index returns have no cap, unlike many market-linked products
• No underwriting required: Simplifies the application process
• Transparent costs: Distribution cost of $1,606 on a $50,000 premium is clearly disclosed
• Diversified underlying index: Multi-asset exposure across equities, bonds, and gold

Cons

• High early surrender penalties: Surrender value starts at just 75% of premium in year 1, rising to only 97% by year 9
• Non-guaranteed income: Yearly income benefits depend on index performance and a non-guaranteed participation rate (minimum 25%)
• No CPFIS or SRS eligibility: Cannot be funded with retirement savings
• Limited protection element: Death benefit of 101% of premium provides minimal insurance coverage — this is primarily a savings vehicle
• Index substitution risk: Great Eastern may replace the underlying index at its discretion

Who It May Suit

GREAT Index Income may appeal to investors seeking a market-linked savings plan with guaranteed capital protection at maturity, who are comfortable with variable annual income and can hold the policy for the full 9-year term. It suits those who want exposure to a diversified multi-asset index without the risk of losing their principal, and who prioritise savings accumulation over insurance protection. Given the steep early surrender penalties, it is not suitable for those who may need access to their funds within the first few years.

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.