Three containers for the same sum
Assume a family holds a sum for 15 years or more that may be spent in a different currency later. The three containers below are compared on terms and rules only; no illustrated returns are used, because illustrations are capped at 6.0% (HKD) and 6.5% (non-HKD) and the non-guaranteed part can be zero.
| Dimension | Single-currency participating policy | Multi-currency policy | Foreign-currency deposit |
|---|---|---|---|
| Currency choice | Fixed at inception | Chosen at inception, switchable after a waiting period | Any time |
| Switch timing and pricing | Not available | Window around the anniversary; insurer-set rate; irrevocable | Any business day at bank rates |
| Value after a switch | Not applicable | Surrender value converted, then guaranteed and non-guaranteed values re-projected on the new plan, possibly higher or lower | Principal converted; interest at the new currency's deposit rate |
| Guaranteed part | Guaranteed cash value table | Same, replaced by a new table on a switch | Principal and agreed interest |
| Non-guaranteed part | Bonuses, rate- and asset-dependent | Same; new bonus group after a switch | None |
| Liquidity | Early surrender value far below premiums; 21-day cooling-off on new policies | Same; new policies created by a switch or split usually have no cooling-off | Instant for demand deposits; interest loss on early time-deposit withdrawal |
| Protection and succession | Death benefit, beneficiaries, sometimes change of life insured | Death benefit, beneficiaries, split, change of life insured, contingent life insured | None; estate process |
USD, HKD and RMB policies
| Dimension | USD policy | HKD policy | RMB policy |
|---|---|---|---|
| Exchange regime | Floating reserve currency | Linked Exchange Rate System, 7.75–7.85 per USD since 18 May 2005 | Offshore renminbi, market-priced, at a spread to onshore |
| Risk for an HKD earner | About 1.3% band | None | RMB/HKD exchange rate |
| Risk for Mainland spending | RMB/USD exchange rate | RMB/HKD (approximately RMB/USD) | Low directional risk; convertibility and policy risk |
| Rate basis | US rate cycle | Follows USD, short-term deviations (1-month HIBOR 2.68% on 3 Nov 2026) | Mainland and offshore RMB rates |
| Illustration cap (from 1 Jul 2025) | 6.5% | 6.0% | 6.5% |
| Convertibility limits | None | None | Insurer discloses no guarantee of conversion into other currencies |
| Policy loan | Usually available | Usually available | Not offered on some products (China Life (Overseas) page: USD and HKD policies only) |
What each container loses in three situations
| Situation | Single-currency policy | Multi-currency policy | Deposit |
|---|---|---|---|
| Policy currency depreciates sharply against the spending currency | Full exchange loss, realised only at surrender or claim | Can switch in the window, but timing is constrained and values are revalued; if the fall has happened, a switch locks it in | Convert any time; the loss has happened but execution is flexible |
| Policy currency rates fall for years | Bonuses may fall short; guaranteed table unchanged | Same; can switch to a higher-rate currency at the cost of new exchange risk and revaluation | Deposit interest falls; can move to a higher-yield currency with exchange risk |
| Funds needed within 5 years | Surrender value far below premiums | Same; a switch does not improve liquidity | No loss on demand deposits; interest loss on time deposits |
The switch option has value mainly in the first two situations, net of execution risk and revaluation; in the third it offers nothing over a single-currency policy. A reader expecting to need the money within five years should start the comparison from liquidity, not from currency.
Sources and dates
- Practice Note on Illustration Rate Caps in Benefit Illustration for Participating Policies — Insurance Authority (IA) · 2025-02-28
- How Does the LERS Work? — Hong Kong Monetary Authority (HKMA) · 2026-11
- ManuGlobal Saver product brochure — Manulife (International) Limited · 2022-05
- Wise Legend Multi-Currency Plan (Excel) product page — China Life Insurance (Overseas) Company Limited · 2026-11
Cite this page
You may quote this page freely; please keep the source and date. Suggested format:
Policy Currency Notes Editorial (2026). “Single-Currency Policy, Multi-Currency Policy or Foreign-Currency Deposit: A Like-for-Like Comparison.” multicurrency.hk. https://multicurrency.hk/en/compare/ (accessed YYYY-MM-DD).