Hong Kong 101 Plan: Frequently Asked Questions

No. It is the Hong Kong market's nickname for a class of investment-linked assurance scheme (ILAS) whose death benefit is 101% of account value. Several insurers have issued such plans under different names. Since 1 January 2015 the regulatory minimum has been 105% of account value (IA GL15 para 5.2), and current products are labelled Pure 105 in their key facts statements.

No. The 105% is applied to the account value, not to premiums paid. If the funds fall 30%, the death benefit is about 73.5% of premiums before charges. Only "capital preservation upon death" designs pay the higher of 105% of account value and premiums paid, and even they protect the death benefit, not the surrender value.

Ownership. Under a 101 plan you are a policy owner with a contractual claim on the insurer, which owns the funds; in a fund plan you own units in assets held by an independent trustee or custodian (IFEC comparison, 20 Feb 2023). Lock-ins, platform fees and bonuses all follow from that structure.

The payment term is the contractual commitment (5 to 25 years in published products). The initial contribution period is the first 18 to 24 months whose premiums build the initial unit account. The lock-in is the "period with surrender charge", which may equal the payment term or be shorter (for example 9 years on a 20-year term).

You can apply for a premium holiday after the initial contribution period, but IFEC's FAQ is clear that charges continue, bonuses fall and the policy lapses if the account cannot cover deductions. The Mainland policyholder statement also warns that the insurer may keep charging on the original premium level.

Published KFS disclose policy-level fees net of bonuses at up to 23% of contributions (5-year term held 20 years, 3% assumed return, 2020) or 15.3%, 25.4% and 32.6% over 10, 15 and 20 years (2025). Fund-level fees are additional, and fund managers rebate up to 60% to 82% of their management fees to the insurer.

No. Welcome and special bonuses are clawed back on surrender or lapse inside the lock-in; loyalty bonuses (0.075% of account value a month in one example) are paid only after the payment term while the policy stays in force. They return part of the platform fee to those who stay.

The Important Facts Statement discloses remuneration on an all-year-average basis: total payments to the intermediary over the payment term divided by total premiums. IFEC's example is 3%, or HK$3 per HK$100 of premium, with early years typically higher. GL26 para 7.6 says disclosure cannot be refused.

Account value minus the surrender charge on the initial unit account minus clawed-back bonuses. One KFS example: initial unit account US$20,000, accumulation account US$6,500, rate 28.5%, charge US$5,700, surrender value US$20,800. In the first year of a plan with a 49% maximum rate, roughly half of premiums paid may be lost.

21 calendar days from delivery of the policy or the cooling-off notice, whichever is earlier (GL29, effective 23 Sep 2019). Premiums and levy are refunded subject to a market value adjustment, which the SFC Code limits to the insurer's loss on realising assets.

When the account value can no longer cover monthly deductions and the grace period expires. IFEC lists this as early termination risk; it is most likely during a premium holiday combined with falling funds, and all premiums and benefits are lost.

Often but not always. Some published KFS allow unlimited free switches with a minimum 5% allocation per fund and a 4 pm cut-off; others charge beyond a free quota. Top-ups require a fresh FNA and RPQ unless made within 12 months through the same insurer or intermediary with no material change (GL26 para 4.2(e)).

The SFC authorises the offering documents under its Code on ILAS; the IA regulates insurers under GL15 and the sale process under GL26 (FNA, RPQ, IFS, remuneration disclosure, post-sale call within five working days). The SFC's 1 November 2021 circular required fees proportionate to protection, with a transition to 30 April 2023 for existing products.

IA provisional statistics: new office premiums of linked individual business were HK$11.2 billion in 2024 and HK$12.7 billion in the first three quarters of 2025, up 75.7%. The figures cover all ILAS.

No. The Important Facts Statement for Mainland Policyholders (effective 1 Sep 2016) requires the whole sale and all signatures to take place in Hong Kong through a Hong Kong-licensed intermediary; sales conducted in the Mainland are outside Hong Kong regulation and may breach Mainland rules. An independent verifier confirms the applicant's presence in Hong Kong. Currency, foreign-exchange and tax matters, including CRS reporting to the Chinese Mainland since 2018, require advice in the applicant's own jurisdiction.