Keep your existing policy

Hi Mr Tan,

I'm 30 years old. I bought my ILP from X in 2002. I'm about to break even in approximately 6 months, if the investment portfolios perform as they are today.

The cost of this policy is very high, but I relized this fact too late. I'm thinking whether to stop this plan after I break even, and switch to a non-ILP life insurance instead. Could you give your opinion on this? Could you suggest other alternatives?

REPLY:

You have already incurred a heavy cost during the past five years. This cost has already been taken away from your policy. Going forward, the cost could be much lower.

I suggest that you talk to your insurance adviser and find out about the future cost. If it is quite small, it may be better for you to continue the existing policy.

Note: It is quite sad that the high charges have deprived you of the opportunity to earn a great return during the past five years. This kind of opportunity comes once in a decade!

For your future purchase, it is better to avoid any insurance policy that has a high cost during the initial years.