by LV Wenqi

Manulife, one of Canada's largest insurers, said its Singapore unit had issued a life insurance policy worth up to US$300 million, setting what it described as a Guinness World Record for the largest policy by face value.

The previous record was set by HSBC Life in Hong Kong in 2024, with a policy valued at US$250 million.

The contract is an indexed universal life (IUL) policy, a hybrid product combining life coverage with returns linked to market indices. First developed in the United States, it is gaining traction in Asia as wealthy families seek downside protection with measured equity exposure.

Unlike direct investments, IUL policies credit returns based on a reference index, subject to a ceiling on gains and a floor — often 0 per cent — to prevent negative returns in downturns. In effect, policyholders trade unlimited gains for capital protection.

"In simple terms, there is upside participation with downside protection," said CHEN Fangting, a Hong Kong-based product designer at a foreign life insurer.

Returns depend on caps, participation rates and fees, and policyholders do not receive full market performance.

With fixed-income yields fluctuating and equity markets volatile, advisers say the structure appeals to ultra-high-net-worth clients prioritizing preservation, tax efficiency and succession over yield.

ZHOU Nan, co-founder of a family office, said wealthy families increasingly focus on asset security and intergenerational certainty. In certain jurisdictions, subject to policy structure and local law, cash value may grow on a tax-deferred basis and death benefits may facilitate wealth transfer. Insurance contracts may also offer some creditor protection.

Liquidity features add to the appeal. Policy loans can redeploy capital during accumulation, and ownership is often embedded in trust structures across jurisdictions.

"We increasingly see entrepreneurs allocate proceeds from IPOs or corporate exits into IUL policies as part of long-term planning," Zhou said.

Singapore and Hong Kong have emerged as hubs for large life policies, supported by established legal systems and cross-border wealth flows. A Singapore-based adviser said such contracts are often held through family trusts and coordinated with offshore entities.

Manulife said it had issued 25 policies with face values exceeding US$50 million over the past 12 months.

In March 2025, Hong Kong incorporated indexed universal life products into its regulatory framework under Class C (linked long term business) of Hong Kong's insurance regulatory framework, restricting sales to professional investors with assets of at least HK$8 million (about US$1 million).

Industry participants caution that the products are complex and suited to clients with long horizons and ample liquidity. As regulators tighten oversight, insurers may face greater scrutiny even as demand grows.