BSP Life Allocates $21.6m in Bonuses

Date: 09/05/2019

BSP Life, Fiji's leading Life Insurance provider has announced that it allocated F$21.6m in Bonuses to its customers or policyholders in 2018.

BSP Life, Fiji's leading Life Insurance provider has announced that it allocated F$21.6m in Bonuses to its customers or policyholders in 2018. This brings the total Bonus allocations to $98.5m for the last five years. A breakdown of the payouts is given below:

 

Year

 2014  2015  2016  2017  2018
 

Bonus Allocations

 $17.8m  $18.7m  $19.8m  $20.6m  $21.6m

Bonuses are based on the performance of BSP Life's Investment portfolio. The Reversionary Bonus for 2018 has remained at 2% of the sum insured and once declared is guaranteed. The Reversionary Bonus is added to previously accumulated bonuses and applied on a compounding basis. This generates better overall value for customers compared to simple bonuses. The table below depicts how Reversionary bonuses accumulate over the term of a policy.

Bonus Calculation  Year 1  Year 2  Year 3  Year 4  Year 5

Sum Insured

 $100,000  $100,000  $100,000  $100,000  $100,000

Accumulated bonuses

 $0  $2,000  $4040  $6,120.80  $8,243.22
 Total sum insured and accumulated bonuses  $100,000  $102,000  $104,040  $106,120.80  $108,243.22

Multiplied by the bonus rate

 2%  2%  2%  2%  2%
 New annual bonus  $2,000  $2040  $2,080.80  $2,122.42  $2,164.86

The Terminal Bonus is a loyalty reward, based on the number of years the policy has been with BSP Life. The Terminal Bonus rate for 2018 is 0.85% increasing from 0.65% in 2017. The Terminal Bonus is added when the policy is paid out.


Mr Nacola stated that, "Fiji is one of a few countries in the world that still offers life insurance policies with an investment or savings benefit. Our customers find these products very attractive as it combines financial protection with future savings and it is encouraging to see more Fijians, especially young job entrants and entrepreneurs, taking up policies as a vehicle to support their financial needs".


"We're also confident that these improving bonus provisions will also encourage many more Fijians to take up a BSP Life policy and also benefit from these bonuses.


Mr Nacola added, "Our ability to allocate these large Bonuses is underpinned by our strong financial standing. We have a stable, balanced and growing investment portfolio, sound governance processes and internationally recognised actuarial expertise to ensure we can deliver on our promises now and in the future. We take this responsibility seriously. We thank our policyholders for their confidence in us and can assure them and prospective new customers that we are committed to honouring this trust."


BSP Life has more than 80,000 policyholders, over 100,000 policies and 140 professional advisors licensed by the Reserve Bank of Fiji, plus Broker partners, to provide tailored solutions to customer needs. There are 10 Customer Service centres Fiji-wide.