Dear Mr. Tan,
You mentioned that the high cost in life insurance products reduces the yield and gives a poor return to the consumer. Does this situation apply to the developed countries as well? If so, why are the consumers there, who are more sophisticated, still buying the high cost life insurance policies?
You will find countries in three broad categories:
1) In some countries such as USA, Australia and France, there are tax benefits in buying certain types of life insurance products. These tax benefits offset the high cost of the products and still give an attractive return to the consumer.
2) In some countries such as Malaysia, the regulator set certain limits on the marketing costs. This ensure that the products give reasonably fair value to the consumers.
3) In countries such as Singapore, the marketing cost is too high and there is virtually no tax benefit to offset it. It is better to buy Term insurance and invest the remainder in a low cost investment fund.
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- Motor Car Insurance
- Educating the public
- Early repayment of housing loan
- Tax Benefits in Life Insurance Products
- Refund of premium
- Keep your money in CPF Special Account
- Financial contagion
- Keep your existing policy
- Term insurance covers critical illness
- Singapore in the year 2010
- Savings for your child
- Commission on high cost policies
- Insurance agents need to make a living
- Critical illness
- Insuring a child for critical illness
- Selecting a policy to terminate
- Critical illness coverage for a baby
- Need a bank loan for a retail business
- Achiever Policy
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- Mr. Tan, I was about to sign up a long term saving...
- Wrong address won 4D first prize
- Jetstar to Kuala Lumpur
- High cost Investment Linked Policy
- Travelling to Kuala Lumpur and Bahrain
- Near target of 1,000 visitors
- Timing the market
- Expense ratio of investment funds
- Investing in REITS
- Calculating the yield
- ETF and Unit Trust
- Decline in interest rate
- Regular replacement of policy
- Financial crisis every 10 years?
- Marketing to residents living nearby
- Greed makes monkey of men
- Financial product with a guaranteed return
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