Insurers keeping annual bonus rates unchanged

POLICYHOLDERS of traditional life insurance plans can heave a sigh of relief.

Despite a relatively poor showing among life funds in 2018, insurers are maintaining their annual bonus rates, reflecting the benefits of the "smoothing" mechanism that applies to participating policies.

Two insurers - Prudential and Aviva - are adjusting terminal bonuses (TBs) on some products. The terminal bonus is a one-time bonus paid when policies mature. Aviva is raising TB rates on some products but cutting on others. Prudential is cutting TB rates for some products.

Performance of seven life insurers' life funds was sharply lower in 2018, as almost all asset classes were dragged down by an uncertain macro economic backdrop and monetary tightening amo…