Tan Kin Lian's Blog: Relevant figures for a decision

Wednesday, January 23, 2008

Relevant figures for a decision

Dear Mr. Tan,

I bought an Ideal Plan (ID2) six months ago, and have been make regular monthly payments.

After reading your blog about Flexi Link and Ideal policies, I am wondering if I should continue with my plan or if I can switch to the Flexi Link plan now? I hope you can advice me.

REPLY

I suggest that you ask the insurance adviser (agent) or NTUC Income's business center to present the facts for the following two options:

1. Continue with the present ID2 plan
2. Stop the plan now, and move your money to Flexi Link.

Do not be shy about asking them to provide the figures to you, that you can make a decision.

Read this FAQ to understand the different charges:
http://www.tankinlian.com/faq/ilp.html

7 comments:

Anonymous said...: I think you had been advised wrongly. You had a lumpsum which should have been invested in flexilink but instead the insurance agent advised you to invest into the regular Ideal Plan ID2. Did you know the difference? The difference is your lumpsum would have made more money or lost more money in the short term but much higher return in the medium to long term than investing regularly. The insurance agent made higher commission(35%) from ID2 than Flexilink( only 1.5%) Your ID2 would struggle to break even , maybe in 4 years time.
Meantime, you should continue the ID2 and invest your lumpsum in the Flexilink. Also change your agent as he or she has proved to be incompetent and unethical.; January 23, 2008 11:39 PM
Anonymous said...: If you have signed up the ID2, whatever cost would have to be paid up.

So, there is not point of terminating it and invest in a flexilink. Lump sum can also be invested in the ID2 with the same cost structure as in Flexilink.

Regular investing, with the dollar averaging concept is a good way of investing with well documented studies (if you choose to believe). It's certainly not the works or genius of the insurance agent or insurers to come up with this idea of investing.

Talk to you Income agent instead of just labelling him as unethical, clear your doubts with him.; January 24, 2008 7:52 AM
Anonymous said...: The agent is not only incompetent and unethical but is also very greedy.You can actually report to CASE and if there is any loss you can recover from the company or sue the agent for inappropriate advice.; January 24, 2008 9:26 AM
Anonymous said...: DCA is a good strategy but it must be used in conjunction with other strategies.. You don't use it blindly and believing that it will sure work for you. Sure, insurance agents never knew what was DCA until recently but can't believe they became experts overnight, .... everything just use DCA to address risk, this is dangerous especially on this mentioned case. This case is very clear that it was driven by greed or incompetence.You don't put a lumpsum to risk by splitting it up into a monthly investment. This is unethical, incompetent , mis-selling and exploitation for personal gain.; January 24, 2008 6:08 PM
Anonymous said...: I had a similar experience with a female agent. I had a lumpsum to invest but instead the agent recommended me to invest in a limited premium Harvest over 5 years.I unknowingly agreed and accepted her recommendation.
I realised what a fool I was when someone pointed out to me that the agent got more commission from Harvest than from Growth.The difference in commission was huge. The agent should have recommended the Growth which gave much higher return than Harvest over the same term. My Harvest is still not at breakeven point.If i had put in Growth it should be making some return.
But because the agent was a family friend and I was advised not to report her .I let her off but still cannot forget what she did. I am writing to warn of such agents who
are unscrupulous and will do anything to earn a higher commission at your expense.; January 25, 2008 12:10 AM
Anonymous said...: May I know if you really have a lump sum and was adviced by the agent to get an ideal?

Your posting did not mention it but people like Zhumeng said so?

I believe to split your lump sum into monthly premium will be mean quite a bit sum? Like what I know, monthly premium of more than $500 in ID2 will require special acknowledgement from you.

Did you sign that? Did you ask why need to sign that?

If you still have the substantial balance now, I think you would be better off investing at current lows and the amount saved might be more than the commission.

Do talk to the agent or visit the Business Centre to clear your doubt.; January 28, 2008 10:11 AM
Anonymous said...: You don't need him to mention expressly to know that this man had a lumpsum but instead was advised to invest regularly.He did say about switching to Flexilink which is a single premium plan, right?
From another posting another customer suffered the same in the hand of his agent in another pair of products, Growth and Harvest. This is another case of unethical manipulation by agent for personal gain. I am sure you will be hearing more of this. Rumor is rife that the agents are combining the 2 new products, revo and vivo and selling as one, revovivo.Another disaster?/; January 29, 2008 12:34 PM