4 Best Short Term Insurance Savings Plans in Singapore (2020)

insurance savings plan

“Insurance savings plans” is an umbrella term for any kind of insurance product that allows you to grow your savings. This includes endowment plans (especially short-term endowment plans) as well as universal life insurance plans like with little or no lock-in (like Etiqa’s ELASTIQ).

With banks cutting their savings accounts interest rates, more Singaporeans are looking to non-bank accounts for higher returns on their savings.

With many of these new plans promising attractive returns, at least for the first year, and little to no lock-in period, short-term insurance savings plans are becoming the new fad. 

 

4 best short term insurance savings plans in Singapore

Here, we’ve compared the most popular short-term insurance savings plans, including a yet-to-be-launched product from PolicyPal:

Insurance Savings Plan

Crediting Rate (Per Annum)

Minimum Deposit

Lock-in Period 

SingLife Account

2% for first $10,000

$500

None

NTUC Income Gro Capital Ease tranche closed

1.96% if you hold it for 3 years 

$5,000 (online)
$20,000 (agent)

3 years

Singtel Dash EasyEarn

1.8% for first year

$2,000

None

GIGANTIQ

2% for first year + up to 8% in credits

$50

None

 

SingLife Account (2% p.a. non-guaranteed)

  • 2% p.a. non-guaranteed returns for first $10,000
  • Min. $500 to open account
  • Maintain min. balance of $100 to earn interest
  • No lock-in period. Free withdrawals

When it comes to short-term insurance savings plans, getting a Singlife account is one recommendation that you’ll hear often, for good reason.

The SingLife account has a projected yield for 2% p.a. for the first $10,000 which is one of the higher interest rates you can get right now. 

All you need is just a minimum of $500 to start, and there’s no lock-in period which means there’s no commitment when you sign up.  Withdrawals are also free, but you need to maintain at least $100 in the account to earn interest.

Big caveat, though: The attractive rates of 2% p.a. is completely non-guaranteed and are subject to change.

 

NTUC Income Gro Capital Ease

Update: Tranche is now closed.

  • High returns of 1.96% p.a., all guaranteed
  • Min. $5,000 premium for online purchase
  • Three-year lock-in period

NTUC Income Gro Capital Ease is a popular single-premium, short-term endowment plan which is typically rolled out in limited “tranches”.

This means plans are only available during a specific period, and at a limited quantity. Think of it as a BTO launch which has a set number of flats available — once you miss out, you have to wait for the next one. 

The latest tranche for NTUC Income Gro Capital Ease is now open, and it offers an eye-popping guaranteed return of 1.96% p.a.

…But only if you hold it to term, for the entirety of the three-year lock-in. You have to park at least $5,000 here for three whole years, which means less flexibility and liquidity in the short term.

Now, a lot can change in three years: You might meet the love of your life, turn your career upside-down, and bank interest rates can go up again. So only go for it if you are really confident about not needing it in the near term.

 

Singtel Dash EasyEarn

  • 1.5% guaranteed + 0.3% p.a. non-guaranteed returns
  • Crediting rate is for first $10,000 in first year only
  • Min. premium of $2,000 to $20,000
  • Maintain min. balance of $2,000 to earn returns
  • No lock-in period, but cash withdrawals cost $0.70 per transaction

An insurance savings plan offered through Singtel’s Dash app, this insurance savings plan is underwritten by Etiqa and offers 1.8% p.a. returns for the first year only.

The returns can be broken down into 1.5% guaranteed + 0.3% non-guaranteed. The guaranteed returns of 1.5% p.a. is one of the highest for a no-lock-in plan, which may appeal to more risk-averse consumers. 

However, there is a fairly high barrier to entry — you need $2,000 to open an account and must maintain that much to earn returns.

Similar to SingLife Account, there is no lock-in period which means you can top-up or withdraw anytime. However, cash withdrawals cost $0.70 per transaction which is a deterrent.

 

GIGANTIQ

  • 1% guaranteed + 1% p.a. non-guaranteed returns
  • Earn additional up to 8% p.a. in PolicyPal credits
  • Crediting rate is for first $10,000 in first year only
  • Min. deposit of just $50!
  • No lock-in period

GIGANTIQ is Etiqa’s newest all-in-one insurance savings and protection plan offering 2% p.a. interest on the first $10,000 for the first year, with no lock-in period. The 2% p.a. can be broken down into 1% p.a. guaranteed and 1% p.a. non-guaranteed.

With a low minimum initial requirement, you can start earning returns from just $50, which happens to be the lowest barrier to entry amongst the plans. If you’re looking for something that is low commitment and not that difficult to begin with, you can consider GIGANTIQ. 

Head here for a full in-depth review of GIGANTIQ

 

Insurance savings plan vs savings account: what’s the difference?

First, we must emphasise that insurance savings plans are NOT savings accounts or fixed deposits. They do work slightly differently and should not be confused or taken as 1-for-1 substitutes.

Here are some key differences to know before you move your savings from your trusty old bank account.

Financial institution: Savings accounts and fixed deposits are provided by banks, while insurance savings plans are provided by insurers. They are subject to different regulations by MAS. That said, insurers are well-regulated in Singapore, and your money is insured by SDIC.

Interest rates: Bank interest rates are always guaranteed, while insurance savings products crediting rates may be guaranteed, non-guaranteed, or a combination of both.

Lock-in period: Certain insurance savings products, such as endowment plans, do have a lock-in period. You’ll need to hold it to term in order to get your full capital and the promised returns.

Here’s a more in-depth article on how to tell if it’s safe to move your money from your bank account.

 

So, should you jump ship from your old savings account

insurance savings plans

If you are fed up with seeing low returns on your bank account, you may want to move some of your funds to one of the above insurance savings plans. 

While they are not the same as a savings account, they do have some similarities.

Low risk: Though not the same risk level as bank accounts, insurance savings plans are still considered low risk options. This is especially in comparison with alternatives such as investment brokerages’ cash management accounts. 

SDIC insured: Both bank deposits and insurance products are protected, up to certain limits, by the SDIC (Singapore Deposit Insurance Corporation)

Flexible: Choose an insurance savings plan with no lock-in and free withdrawals, and you can enjoy a similar level of flexibility as a regular savings account. It’s a good place to store your emergency fund, for example.

So, if you have a low risk appetite and value flexibility, then perhaps these plans may do the trick for you.

Should you have no large immediate payments in the short term, you may also want to consider a longer-term endowment plan instead. It’s a great way to save up money for the future, whether it’s for yourself or your family. 

 

This advertisement has not been reviewed by the Monetary Authority of Singapore. Information is accurate as of 7 October 2020.

 

Read more:
7 Best Apps to Grow Your Savings & Earn Money
10 Best Long & Short Term Endowment Plans in Singapore
Is It Safe to Switch From a Bank Account to Non-Bank Account?
Best Etiqa (Tiq) Insurance Savings Plans in Singapore

PolicyPal

PolicyPal

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