Case Study: Certainty in volatility
Background
PCS by Mercer client is in his 50s. He has recently stepped down as the chairman of a publicly listed company in which he remains a substantial shareholder.
Our client is married and has three adult children.
Key considerations
Our client is a sophisticated entrepreneur. He understands the current global economic and geopolitical volatility, and he aware that his wealth is could be concentrated in too few asset classes – particularly company shareholdings.
He is actively trying to manage his family’s risks and exposure by diversifying his assets. And he sees offshore insurance would be a good way of mitigating risk while providing a source of reliable offshore liquidity for his family.
Being data-driven in his decision-making process, transparency in numbers is very important to the client.
Solution
When we first met him, the client expressed some interest in Whole of Life solutions for the product’s guaranteed features, but he was also open to considering other options.
After assessing the client’s unique needs, we presented two solutions: Whole of Life as well as Indexed Universal Life. Understanding the client’s need for transparency, our presentation included all premium obligations and pay options for each choice as well as all the guaranteed and potential bonus payout scenarios.
The client selected the Indexed Universal Life option. (Indexed universal life insurance is a class of permanent life insurance that offers a death benefit and an investment component tied to the performance of a stock market index. The policyholder can choose the proportion of their premium that goes towards the investment component, which has the potential to accumulate cash value over time.)
We also proposed multi-pay as the payment method to maximize the client’s liquidity.
Premium: USD1 million via multi-pay
Total sum assured: USD50 million
Key takeaways
Offshore insurance could be considered when entrepreneurial clients are looking to diversify the composition of their net worth, particularly in instances where a significant portion of their assets are tied in company shareholdings.
Indexed Universal Life solutions provide maximum sum assured leverage to the client, giving them absolute transparency on how cash value is accumulated.
PCS by Mercer are experts in helping you safeguard your wealth. We commit to presenting the best possible solutions that meet unique HNW needs.
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is a Managing Director at Private Client Services by Mercer. A seasoned senior Consultant, she has close to 20 years of extensive experience in the High Net Worth (HNW) life insurance industry working closely with private bankers, wealth planners, lawyers and accountants in customising bespoke solutions for their HNW and Ultra HNW clients’ long term needs. Based in Singapore, Glenda has a track record in managing and closing complex and mega HNW life insurance deals for clients in multiple jurisdictions. With her strategic and collaborative approach in wealth and liquidity planning, she is energetic and affable, and has gained the trust of her partners and clients over the decades. Glenda received her Bachelor of Commerce degree in Finance and Marketing from the University of New South Wales, Australia, and is a certified holder of Trust Estate Planning (TEP). She is fluent in English and Mandarin.
Email: Glenda.Tan@mercerpcs.com