A 12-point checklist before buying participating life in Hong Kong or Singapore: fulfilment ratios, bonus settlement, insurable interest and beneficiary arrangements

This checklist is a tool for checking the facts, item by item, before choosing between a Hong Kong participating savings plan and Singapore participating whole life. It does not compare which product returns more; instead it confirms twelve things that affect long-term outcomes: currency, disclosure, illustrations, liquidity, policy terms, insurable interest, signing, source of funds, financing, legacy, claims and tax. Each item lists the "documents to read" and the "questions to ask", and answers should be obtained in writing. Jurisdictions: Hong Kong and Singapore; for foreign exchange and tax questions concerning Mainland residents, obtain professional advice in your own jurisdiction.

How to use this checklist

It is best used three times: first when comparing options, to rule out those that clearly do not fit; second before signing, to request documents and written answers item by item; and third during the cooling-off period (21 calendar days in Hong Kong, 14 days in Singapore), to check everything again against the formal policy documents.

Part 1: currency, disclosure and illustrations (items 1–3)

1. Does the policy currency match the living currency?

• Documents to read: the currencies available in the product brochure and the currency switching provisions.
• Questions to ask: in what currency will future spending (children's education, retirement, legacy) take place? The HKD and the USD are tied by the Linked Exchange Rate System, while the SGD is managed by MAS through a trade-weighted exchange rate policy, so the nature of the exchange rate risk differs. If the policy allows a currency switch, is it a conversion into a new plan designated by the insurer? Who bears exchange gains and losses? See Choosing the policy currency.

2. Have the fulfilment ratios and bonus disclosures been read?

• Documents to read: fulfilment ratios on the Hong Kong insurer's website (the IA requires them to be published by 30 June each year, by product series, year by year for the latest 10 policy years); in Singapore, the product summary and annual bonus notice (MAS Notice 320 requires disclosure of the participating fund's past investment returns, expense ratio and bonus rates).
• Questions to ask: how have fulfilment ratios for this product's series performed in later policy years? Are annual, reversionary and terminal bonuses disclosed separately? For a new product without history, which series is the reference? Past fulfilment ratios do not indicate future distributions. See How to read fulfilment ratios.

3. Have all illustration scenarios been reviewed?

• Documents to read: the base, optimistic and pessimistic scenarios in the benefit illustration.
• Questions to ask: of the two markets' illustration caps, one limits the customer IRR and the other the investment rate of return, so they cannot be compared directly, and neither is a promise of actual distributions (see Illustration caps compared). Under the pessimistic scenario, what share is guaranteed? How large a share of total benefits do terminal bonuses make up?

Part 2: liquidity, policy terms and insurable interest (items 4–6)

4. Can early surrender losses be absorbed?

• Documents to read: the year-by-year guaranteed cash value and total cash value in the benefit illustration.
• Questions to ask: in which year does the guaranteed cash value first reach the premiums paid? If money is urgently needed in the first few years, what does a surrender or policy loan cost? The Investor and Financial Education Council (IFEC) advises paying attention to the proportions of guaranteed and non-guaranteed benefits in the benefit illustration.

5. Are the policy features written into the contract?

• Documents to read: the policy provisions and endorsements, not the marketing leaflet.
• Questions to ask: for policy split, change of life assured, currency switching, a contingent policyholder and continuation by policy split on death, what are the starting policy year, number of times, minimum amount, maximum age and evidence of insurability required? Is insurer approval needed? After an application, what happens to riders, beneficiaries and the contingent policyholder? Under which product series is a split or changed policy reported for fulfilment ratio purposes? For continuation by policy split on death compared with a direct claim, are reversionary and terminal bonuses settled at face value or at cash value? See Policy split and change of life assured.

6. Is there an insurable interest?

• Documents to read: the statement in the application form of the relationship between policyholder and life insured.
• Questions to ask: sections 64A–64B of Hong Kong's Insurance Ordinance require an insurable interest; the statutory presumption covers a parent or guardian in respect of a minor child, oneself and one's spouse are generally recognised, and other relationships require proof of financial interest. Section 146 of Singapore's Insurance Act has similar requirements; otherwise the policy is void. If a future change of life assured is planned (especially across generations to a grandchild), will the new life assured meet the requirements?

Part 3: signing, funds and financing (items 7–9)

7. Are the place and procedure of signing compliant?

• Documents to read: the application form and signing declarations; in Hong Kong, the Important Facts Statement for Mainland Policyholders (IFS-MP).
• Questions to ask: customers holding a People's Republic of China resident identity card who apply for an individual long term policy in Hong Kong must sign the IFS-MP, which confirms that the sales process took place in Hong Kong; in Singapore, whether a non-face-to-face application is accepted and what additional checks are needed is for each insurer to decide under the MAS anti-money laundering rules. For a side-by-side view of the application steps, see Application process.

8. Is the source of funds clear and lawful?

• Documents to read: source of funds and source of wealth declarations, bank statements and other evidence.
• Questions to ask: from which account, and in what currency, will premiums be paid? Mainland residents must comply with foreign exchange rules (see Policy currency). This site does not give any advice on routes for moving funds.

9. If financing is used, is the stress test complete?

• Documents to read: the facility letter and assignment documents; in Hong Kong, the Important Facts Statement for Premium Financing (IFS-PF).
• Questions to ask: IA standards in Hong Kong require an assessment of whether the customer can repay if the lender demands early repayment; does the test cover all three scenarios - bonuses below illustration, rising interest rates and early repayment? After assignment, do rights such as cooling-off cancellation and change of life assured require the lender's consent? See Premium financing for participating life.

Part 4: legacy, claims and tax (items 10–12)

10. Do the beneficiary and legacy arrangements fit the family structure?

• Documents to read: beneficiary designation or nomination forms, trust documents and wills.
• Questions to ask: does the Singapore policy use a trust nomination or a revocable nomination? Has the Hong Kong policy named a contingent policyholder and contingent beneficiaries? Is the trustee licensed or exempt? See Cross-generational legacy with participating life.

11. Are the claim documents for where a claim may arise understood in advance?

• Documents to read: the insurer's death claim checklist; the November 2025 guide on submitting death claims from the Life Insurance Association Singapore (LIA).
• Questions to ask: if death occurs in the Mainland or a third jurisdiction, what notarisation, legalisation and translation will be needed? If there is no valid beneficiary, must probate be obtained first? A grant obtained in Hong Kong must be resealed by the Singapore court before it can be used for a Singapore policy. See Cross-border claims on Hong Kong and Singapore policies.

12. Have tax residency and reporting been clarified?

• Documents to read: the CRS self-certification form; the tax law of your jurisdiction.
• Questions to ask: cash value insurance contracts are reportable under the CRS in both Hong Kong and Singapore, and information is exchanged under the rules with the jurisdiction of tax residence; individual Mainland residents must report overseas income under Announcement No. 3 of 2020 between 1 March and 30 June of the following year. The characterisation of bonuses and surrender gains is a matter for the relevant tax authority, and professional tax advice is recommended.

Readers who still have questions after working through the checklist can register their needs through this site's contact options for a reading based on their own situation.