Are there any risks involved in insurance savings plan? I heard that insurance savings plan are insurance branded as saving plans to acquire customers.?

An insurance savings plan is a type of life insurance policy that combines savings and protection. However, it usually has a low life coverage component, thus it should not be used solely for protection purposes.

Insurers and banks have different standards of compliance and are regulated differently by MAS. Therefore, an insurance savings plan is not a one-for-one substitute for a savings account or fixed deposit.

However, insurance savings plans are relatively low-risk for two reasons:

(a) SDIC Policy Protection Scheme

In the case of a default by the insurance company, if your policy is insured by a company covered by the SDIC's PPF scheme, you will be protected up to S$100,000 for guaranteed sum assured and S$50,000 for guaranteed surrender value per policy.

(b) Guaranteed returns

Most insurance saving plans come with two types of returns, guaranteed and non-guaranteed. It is safe to assume you will get the guaranteed returns. (The non-guaranteed returns are based on the investment performance in the participating fund of the endowment policy, which is the risky part. If you want, you can disregard non-guaranteed returns when comparing products.)

To sum it up, insurance savings plans are higher risk than banks, but still much lower risk than investing or investment-based accounts.

There are no long term savings plans in the market as far as I know of that are not from insurance companies. Do let me know if you manage to find one.