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Pros and Cons of AIA Platinum Legacy

AIA Platinum Legacy is a universal life policy offered by AIA (Singapore) agents, CitiBank relationship managers and independent financial advisors. It is a legacy planning tool that creates an immediate estate for the policyholder by paying a single premium and free up assets for retirement needs.

There are four underwriting risk classes. The risk class Standard and Preferred are available for both smoker and non-smokers. The risk class Standard Plus and Preferred Plus only offers to non-smokers. The underwriting class will be confirmed after the medical underwriting assessment is completed. The current version is version VIII

AIA Platinum Legacy

Image is taken from www.aia.com.sg

The current crediting rate is 4.3% per annum (promotional campaign rate subject to changes. The usual rate is 4.0%) with guaranteed minimum crediting rate of 1.5% per annum. The minimum sum assured is USD 500,000 and this is a closed tranched plan. The first-day cash value is approximately 81% of the initial premium. Premium financing is available for leverage.

Pros of AIA Platinum Legacy

  1. The premium is competitive (but NOT the lowest) compared to other insurers’ universal life policy with the same underwriting class risk

Cons of AIA Platinum Legacy

  1. The minimum crediting rate is 1.5% and it is lower than most competitor’s minimum rate of 2%
  2. Insurance risk charge is until age 122 while some insurer’s charges are until age 100 only

As the current crediting rate of 4.3% is a promotional rate for the first 3 policy years, it is prudent to find out the projected outcome of AIA Platinum Legacy (especially at which age the plan will terminate) based on a lower crediting rate such as 3.75% or 3.25% per annum.

To view a projection of Platinum Legacy projected based on crediting rate between 3% to 4%

To know how Platinum Legacy fares with other insurers’ plan.

To evaluate if Platinum Legacy is suitable to you

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Besides AIA Platinum Legacy, you may want to read up more about universal life policy here.

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