Combine investment growth potential with insurance protection. ILPs let you invest in professionally managed funds while maintaining life coverage, ideal for expats seeking wealth accumulation with flexibility.
Understanding
Investment-Linked Policies split your premium into two parts: one portion pays for life insurance coverage, and the rest is invested in sub-funds of your choice. Unlike traditional policies with guaranteed returns, ILP returns depend on fund performance with higher risk but potentially higher rewards.
For expats, ILPs offer flexibility to adjust coverage and investment allocation over time. As your needs change, perhaps from protection-focused when young to wealth accumulation as you age, you can rebalance without buying a new policy.
ILPs have higher fees than direct fund investments. The convenience of combined insurance + investment comes at a cost. Make sure you understand all charges before committing, and consider if "buying term and investing the difference" might be more suitable for your situation.
Regular or single premium contributions
Choose from equity, bond, or balanced funds
Insurance charges deducted from units monthly
Account value fluctuates with fund performance
Expert Advice
ILPs have bid-ask spreads, fund management fees, insurance charges, and admin fees. Total annual costs can exceed 2-3%.
Front-loaded charges mean early surrender results in significant losses. Only invest if you're committed for 10+ years.
Unlike endowments, ILP values can drop. Review quarterly and switch funds if underperforming. Most ILPs allow free switches.
Single premium versions have lower fees and are better for lump sum investment. Avoid if you need regular protection.
Calculate if buying term insurance + direct fund investment gives better value. ILP convenience has a price.
Most ILPs remain valid globally. Confirm premium payment methods and access to fund switching from overseas.
Get expert guidance on whether ILPs are right for your financial goals.