Total Payout Ratio for Participating Products
To provide you an overview of the overall historical performance of HSBC Life (International) Limited (the "Company")'s participating products reflecting both the guaranteed and non-guaranteed benefits, the following shows the total payout ratio for each of the Company’s participating products which have new policies issued since 2010 and still have in-force policies in the reporting year. These results are intended for reference purpose only and should not be taken as indicator of future performance of participating products. The actual payout ratios in future may be lower or higher than the historical payout ratios as illustrated. If you have an HSBC Life policy, you can review the policy value and other policy details through HSBC Online Banking or HSBC Mobile Banking app.
What is the Total Payout Ratio?
The total payout ratio is calculated as the ratio of the aggregate actual total cash value against the aggregate illustrated amounts at the point of sale for all the relevant in-force participating policies at that policy year. The total cash value reflects both the guaranteed and non-guaranteed benefits which include guaranteed cash value, accumulated endowment coupons and interests (if applicable), accumulated annuities and interests (if applicable), accumulated dividends and interests, special bonus (if applicable) to be paid upon surrender etc.
How should I interpret the result of total payout ratio?
The total payout ratio will be 100% when the actual total cash value matches with the illustrated amount at the point of sale. If it is above 100%, it means actual total cash value is larger as compared with the illustrated amount and if it is below 100%, it means the opposite.
However, it should be noted that the total payout ratio can only reflect the performance for a certain past period of the policies issued and it cannot represent any future dividend plan and strategy over a longer term for the remaining policy years. As such, it is not suggested taking the total payout ratio result as an indicator of future performance of the participating products.
Illustrative example
| Policy | Policy Effective Date | Policy year | Guaranteed Benefits (HKD) (A) |
Non-guaranteed Benefits Illustrated (HKD) (B) |
Non-guaranteed Benefits Actual (HKD) (C) |
Total Cash Value Illustrated (HKD) (A) + (B) |
Total Cash Value Actual (HKD) (A) + (C) |
|---|---|---|---|---|---|---|---|
| 1 | 15 Jan 2012 | 4 | 20,000 | 5,500 | 3,000 | 25,500 | 23,000 |
| 2 | 20 Sep 2012 | 4 | 30,000 | 8,000 | 5,000 | 38,000 |
35,000 |
| 3 | 5 May 2013 | 3 | 70,000 | 5,000 | 4,000 | 75,000 | 74,000 |
| 4 | 30 Oct 2013 | 3 | 50,000 | 3,500 | 2,500 | 53,500 | 52,500 |
| 5 | 1 Apr 2014 | 2 | 50,000 | 500 | 500 | 50,500 | 50,500 |
| Policy | 1 |
|---|---|
| Policy Effective Date | 15 Jan 2012 |
| Policy year | 4 |
| Guaranteed Benefits (HKD) (A) |
20,000 |
| Non-guaranteed Benefits Illustrated (HKD) (B) |
5,500 |
| Non-guaranteed Benefits Actual (HKD) (C) |
3,000 |
| Total Cash Value Illustrated (HKD) (A) + (B) |
25,500 |
| Total Cash Value Actual (HKD) (A) + (C) |
23,000 |
| Policy | 2 |
| Policy Effective Date | 20 Sep 2012 |
| Policy year | 4 |
| Guaranteed Benefits (HKD) (A) |
30,000 |
| Non-guaranteed Benefits Illustrated (HKD) (B) |
8,000 |
| Non-guaranteed Benefits Actual (HKD) (C) |
5,000 |
| Total Cash Value Illustrated (HKD) (A) + (B) |
38,000 |
| Total Cash Value Actual (HKD) (A) + (C) |
35,000 |
| Policy | 3 |
| Policy Effective Date | 5 May 2013 |
| Policy year | 3 |
| Guaranteed Benefits (HKD) (A) |
70,000 |
| Non-guaranteed Benefits Illustrated (HKD) (B) |
5,000 |
| Non-guaranteed Benefits Actual (HKD) (C) |
4,000 |
| Total Cash Value Illustrated (HKD) (A) + (B) |
75,000 |
| Total Cash Value Actual (HKD) (A) + (C) |
74,000 |
| Policy | 4 |
| Policy Effective Date | 30 Oct 2013 |
| Policy year | 3 |
| Guaranteed Benefits (HKD) (A) |
50,000 |
| Non-guaranteed Benefits Illustrated (HKD) (B) |
3,500 |
| Non-guaranteed Benefits Actual (HKD) (C) |
2,500 |
| Total Cash Value Illustrated (HKD) (A) + (B) |
53,500 |
| Total Cash Value Actual (HKD) (A) + (C) |
52,500 |
| Policy | 5 |
| Policy Effective Date | 1 Apr 2014 |
| Policy year | 2 |
| Guaranteed Benefits (HKD) (A) |
50,000 |
| Non-guaranteed Benefits Illustrated (HKD) (B) |
500 |
| Non-guaranteed Benefits Actual (HKD) (C) |
500 |
| Total Cash Value Illustrated (HKD) (A) + (B) |
50,500 |
| Total Cash Value Actual (HKD) (A) + (C) |
50,500 |
| Product | Policy(ies) effective in 2012 (Policy year 4) (HKD) |
Policy(ies) effective in 2013 (Policy year 3) (HKD) |
Policy(ies) effective in 2014 (Policy year 2) (HKD) |
|---|---|---|---|
| Product A | (23,000+35,000) / (25,500+38,000) = 91% | (74,000+52,500) / (75,000+53,500) = 98% |
50,500 / 50,500 = 100% |
| Product | Product A |
|---|---|
| Policy(ies) effective in 2012 (Policy year 4) (HKD) |
(23,000+35,000) / (25,500+38,000) = 91% |
| Policy(ies) effective in 2013 (Policy year 3) (HKD) |
(74,000+52,500) / (75,000+53,500) = 98% |
| Policy(ies) effective in 2014 (Policy year 2) (HKD) |
50,500 / 50,500 = 100% |
Total payout ratio by product category
Notes:
- Some of the above fulfillment ratio or Total payout ratio are shown as "N/A" because:
- There are no relevant in-force policies in the respective policy year for some products; or
- The dividend amount / special bonus amount / illustrated amount at point of sale is zero and hence fulfillment ratio or total payout ratio is undetermined; or
- The special bonus amount illustrated at point of sales was non-zero, but there were no relevant policies actually terminated in the reporting year and therefore there is no reportable statistics
- There are no relevant in-force policies in the respective policy year for some products; or
- The figures shown in the above illustrative example are for illustrative purpose only.
- With effect from 1 July 2017, the Insurance terminology for Terminal Bonus has been updated to Special Bonus for the purpose of reading the policy provisions and other documents related to your policy. Please note that the change will not impact the original meanings and definitions of the insurance terminology for your policy concerned. For details, please visit https://www.hsbc.com.hk/insurance/info
- The products shown above are underwritten by HSBC Life (International) Limited (the "Company"), an HSBC Group insurance underwriting subsidiary. The Company is incorporated in Bermuda with limited liability and is authorized and regulated by the Hong Kong Insurance Authority to carry on long-term insurance business in the Hong Kong SAR. You are subject to the credit risk of the Company. Your premiums paid will form part of the Company's assets. You do not have any rights or ownership over any of those assets. Your recourse is against the Company only. The above insurance products are long-term life insurance protection. They are not equivalent or similar to any kind of bank deposit. The proceeds received upon policy surrender, whether partial or full, may be less than the total premiums paid.