Is this a good plan?

Dear Mr Tan,

I wish to seek your opinion on my following whole life plan.

Quick summary:
I bought this policy in year 2000 through an Insurance broker.

- Plan: Enhanced living assurance
- Premium: S$1924 per year
- Start date: 23/5/2000 age 33
- Premium cessation date 22/3/2052 (ie age 85)
- Sum assured: S$100000
- Annual reversionary bonus: $10/$1000 sum assured plus 1% of accumulated bonus.

Projection at time of purchase:
- At age 65: total premium S$61,568
- Death benefit: guaranteed S$100,000 non guaranteed S$84,361
- Surrender value : guaranteed 57400 non guaranteed S$33,190

Current policy status as at year 2006:
- Total premium paid-up S$11,544
- Total bonus declared S$6,152 (meet expectation at in quotation)
- Death benefit :guaranteed S$100,000 non guaranteed S$6,152
- Surrender value : guaranteed S$8,000 non guaranteed S$2,251

I have seriously considered surrendering this policy and go into term policy.
Appreciate your kind advise if this is a wise choice for me.

LYF

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Dear LYF

Let me get my colleague to take a look at it. We will reply to you within a few days.

The living assurance covers 30 critical illness. What does the "enhanced" cover?

My initial response is that it is better for you to continue with the current policy as it provides covers "enhanced" critical illness for the whole of life. If you buy a decreasing term assurance, including cover for critical illness, it will expire at a certain age, e.g. 65 years.

Let me see if the accumulated savings at that time is more than sufficient to offset the loss of coverage

Tan Kin Lian