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Guaranteed before illustrated

Savings Insurance IRR Calculator

Copy guaranteed and illustrated surrender values from the same benefit illustration, then compare that year’s IRR with a deposit. The illustrated figure is not guaranteed.

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Policy details

Guaranteed IRR at this surrender year

Illustrated IRR 3.05%

0.91%
HK$ 60,000
5 years
20 years
HK$ 350,000
HK$ 500,000
3%

Copy guaranteed and illustrated surrender values from the same benefit-illustration year. This page does not price every policy year.

• This page prices only the surrender year you enter, not the whole policy.

• The guaranteed value is the contractual amount.

• The illustrated value usually includes non-guaranteed dividends and can be lower.

Guaranteed IRR at this surrender year

0.91%

Total premiums HK$300,000 over 5 years. Illustrated IRR 3.05%.

HK$150,000 of the illustrated HK$500,000 is not guaranteed (30%).

Guaranteed IRR

0.91%

Expected IRR

3.05%

Guaranteed profit

HK$50,000

Guaranteed vs deposit

-HK$146,288

Deposit FV HK$496,288 at 3.0%

View policy details

Total premium

HK$300,000

Guaranteed multiple

1.17x

Expected multiple

1.67x

Holding period

20 year

Suggestion:The guaranteed value is HK$146,288 below putting the same premiums into a 3.0% deposit with the same payment dates. This page prices one surrender year only.

Savings-insurance IRR is not the illustrated total return

A sales page that says “500% total return” adds up a distant future amount. It does not show that you paid premiums years earlier. IRR converts those outflows and the surrender inflow into an annual compound rate, which is easier to compare with a deposit. This page prices only the surrender year you enter, not every year of the policy.

The guaranteed value is the contractual amount. The illustrated value usually includes non-guaranteed dividends, which can be higher or lower than the brochure. IA Guideline 16 requires participating policies to disclose fulfilment ratios. Do not treat the projected IRR as guaranteed, and do not treat the guaranteed IRR as what you receive on death or on an early surrender.

The calculator uses the same premium dates to grow those premiums at the deposit rate you enter. If the guaranteed value is below that deposit future value, the certain return is weaker than that comparison. Use a rate you can actually get, not the insurer’s illustrated rate.

Ask for the guaranteed and illustrated values from the same benefit-illustration year, the latest fulfilment ratio, the cooling-off period and surrender charges. Life cover and riders are not priced here. The policy and the insurer’s quotation remain decisive.

References

FAQs

What is IRR?

IRR is the annual compound return after converting each premium and the surrender value into a time-weighted rate. It is more comparable across terms than a total-return multiple.

What is the difference between guaranteed and illustrated return?

The guaranteed value is contractual. The illustrated value usually includes non-guaranteed dividends and can be lower than the brochure if fulfilment is weaker.

Why is the brochure total return so much higher than IRR?

The brochure adds a distant future amount without showing that premiums were paid years earlier. IRR includes the timing of those payments, so the percentage is usually much smaller.

Does this calculator show the whole policy’s return?

No. It prices only the surrender year you enter. Other years, death benefit and early-surrender charges are not included.

What should I compare the IRR with?

Start with the guaranteed IRR and a deposit or low-risk return you can actually get. A high illustrated IRR only means the non-guaranteed assumption is ambitious.

What figures do I need?

Copy the annual premium, contribution term and the guaranteed and illustrated values for the same year from one benefit illustration, then enter a comparison deposit rate.

Client-side only: All data is calculated on your device and is not uploaded to any server. Results are for reference only and do not constitute professional financial or legal advice.