Sony Life Insurance Co., Ltd.("Sony Life"), a wholly owned life insurance subsidiary of Sony Financial Holdings Inc., will launch educational endowment insurance (non-participating) as a new product on January 2, 2014. The addition of this product to its lineup of semi-participating educational endowment insurance will enable Sony Life to meet the needs of a broader customer base.
1. Background for the Launch
Sony Life began offering semi-participating educational endowment insurance in May 1998. As the current product was semi-participating, this new educational endowment insurance (non-participating) is being introduced to meet the needs of customers who wish to minimize the burden of insurance premiums.
Furthermore, in addition to the Type I and Type II products available to date, Sony Life has introduced Type III insurance, under which educational fund payments are divided and paid while the insured child is attending college. Sony Life has also introduced a plan under which insurance premiums can be paid over a short period. This range offers customers a more extensive range of plans to meet their needs for planning children’s education.
2. Features of Educational Endowment Insurance (Non-Participating)
This product is heavily weighted toward savings, enabling policyholders to accumulate funds to pay for children’s education efficiently. Three types are available to choose from.
- Type I: In addition to funds to pay for college, this type also provides funds to pay enrollment fees of junior high school and high school comprehensively.
- Type II: This type concentrates on accumulating funds to pay costs upon entering college.
- Type III: This type provides educational funds each year after entering college.
Period of Receipt and Surrender Rate by Type
Assumptions: Policyholder is a 30-year-old male, insured party is less than 1 year-old, premium
payment period is through age 18, premium is payable monthly
- Plans are also available that allow insurance premiums to be paid in over a shorter period before entering junior high school, while school tuition and fees are inexpensive.
- These plans are non-participating, which allow insurance premiums to be set at lower levels.
- A special rider is available under which these policies can be entered into prior up to 140 days prior to a child’s birth (up to 91 days for Type III).
- In the event that the policyholder dies or suffers predefined serious disability or injury within the insurance period, no insurance premiums are required after that time, ensuring that funds are available to pay for a child’s education even if the unexpected occurs. Also, a death benefit is paid in the event that the insured child dies within the insurance period.