Anticipation policy

COMMENT IN MY BLOG (on Whole Life policy with cash payment every 5 years):

If such policies are bad for the consumers, why does NTUC Income, which claims to work in the interest of their policy holders, continue to offer the Anticipation Policy which has a cash payout every 3 years? Looks like a case of saying one thing but doing another.

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REPLY

The Anticipation policy was offered by NTUC Income about 25 years ago, when I was the general manager.

At that time, it offered an attractive yield of 4% or better. The reasons were:

* the sales charge of NTUC Income were much lower than the market
* the investments earned a good rate of return (during a period when interest rate was higher)
* the flexible investment-linked plan was not available
* the return was better than bank deposits

I will not recommend the sale of the Anticipation policy today, for the reasons that I have posted about the whole life policy with cash payment every 5 years.