Hi Mr Tan
.... you mentioned total premiums $5,600 was made and policy has existing cash value of $2,700 with a "loss" of $2,900... just curious, are you expecting free insurance?
This is a whole life policy about $430/yr or $35/mth. Even if you were to get term insurance at $80/yr, you would have "lost", $1,040 after 13 years.
Furthermore, assuming that her budget is $430/yr and that is all she can spare, where would you suggest she invest the balance of $350/yr, to get a investment gain of 4% p.a.
Even if she had invested and able to get 4% p.a., for the last 3 months, all the equity markets were down, it would be hard for her to sell as her funds would have dropped at least 20% in value.
It would be good to know what the expected surrender value is after 20 years so that we have a better picture.
The term insurance premium for a cover of $30,000 should be less than $30 a year. The life insurance company sell high cost products that takes away more than 10 times of the real cost, and locks the customer into a product that they will suffer a big loss for the "whole life".
Many insurance agents make a living out of the losses of their customers. There are many new customers that they can take advantage of, each day.
I hope that the life insurance industry and its "professional" agents will be ethical in doing what is right for customers.I have never seen any whole life policy that offers such a poor cash value after 13 years. Matters are getting out of hand.
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