Boost Your Portfolio with Traded Endowments

Presented by Conservation Capital

As an investor, you have probably sought out investments that can deliver returns in a shorter time, or offering higher gains than similar instruments on the market. This is possible with traded endowments, also known as second-hand insurance.

What are Traded Endowments?

Traded endowments are essentially the same savings and investment plans offered by reputable insurance companies based in Singapore. They are called traded endowments because the policy is transferred from the original policy holder to a new policy holder. This makes traded endowments low-risk, good-quality investments. Traded endowments also mature faster for the new policy holder. For example, a policy holder bought a 10-year endowment policy and had paid for it for 6 years, before deciding to sell the policy. The policy was then picked up by a new holder, who collected the full returns of said policy at maturity after paying the remaining premium for only 4 years. One other benefit is that these endowments may be distressed assets that are sold below their market value, making it possible to immediately be in profit simply by purchasing a policy.

How Endowments are Traded

Endowments can be traded between policy holders through companies such as Conservation Capital, which applies a personalised approach to select the investments according to customers’ investment goals and risk appetites.

Conservation Capital is an independent service provider that specialises in offering the best prices for the purchase of local resale endowment policies and aims to provide the best value possible to both sellers and buyers of resale endowment policies.

While the company offers a limited variety of policies, they extend bespoke investment services to help clients build a portfolio of investments that mature year on year with short-term policies that provide high returns.

Products on Offer

Conservation Capital offers two types of policies: annuities and endowments.

Annuities provide guaranteed annual returns to investors at a yield of 3% to 6% per year. This makes them excellent investment vehicles for investors who would like to have a constant stream of passive income in future, similar to buying and renting out properties. Annuities can provide similar returns and do not require the holder to pay tax and maintenance, or find good tenants to rent out to.

Endowment plans, on the other hand, are long-term savings plans. When sold, they are typically “aged”; and are often sold when there are only a few years to maturity so that investors can quickly collect their investment returns.

Value of Traded Endowments

There are several ways to maximise your returns from traded endowments.

First, you can purchase a distressed asset. Typically, the seller had already paid for the policy for several years by the time it is sold. They might then sell it because they need liquid cash and are willing to accept a price lower than the capital which they had paid. You can buy a policy worth SGD 24,000 at a price of SGD 16,000, and will be SGD 8,000 in profit immediately. You can also benefit from the return on investment by holding it to maturity.

Second, you can get guaranteed returns from buying a policy that has accumulated bonuses over a long period of time. It may have a few years left to maturity, and having reviewed the projections, Conservation Capital offers to buy back the policy from the holder just a few months prior to the maturity date. This provides two assurances: first, the insurance company has already guaranteed a maturity value by the maturity date. Second, Conservation Capital provides a buyback offer as well.

This way, the investor can get back their investment capital and any returns from Conservation Capital, or from the insurance company if Conservation Capital is no longer operational at the time of maturity.

Third, an investor may choose to purchase a fully paid policy or pay annual premium. Purchasing a fully paid policy backed by a reputable insurance company and having the bonuses accumulated until maturity is much like buying a bond, but with a higher rate of return.

A valuable addition to your investment portfolio

As low-risk, high return and short-term investments, traded endowments have a place in any investment portfolio. If you are considering how to optimise your portfolio, traded endowments might fill a sweet spot for you.

For more information, contact Conservation Capital and receive a complimentary one-to-one consultation on how to grow your investments with traded endowments.

Tel: 6222 0338
Email: info@conservationcapital.com.sg
Website: http://www.conservationcapital.com.sg

Conservation Capital is not a regulated entity under the MAS. We are not an insurance company and there are not existing regulations which govern the sale, purchase and distribution of resale insurance policies. The transfer of insurance policies is however a format process which is done legally at the insurance company and witnessed by the insurer.

 

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