Tan Kin Lian's Blog: ILP policy takes away most of the premiums

Saturday, April 05, 2008

ILP policy takes away most of the premiums

Dear Mr. Tan,

I've bought an ILP policy. My premiums are $1200 per year and have paid it for two years. I has cash value of about $310 now. The sum insured is 100k. It is a yearly premium and the third one is going to be due soon.

After reading about the charges and feasibility of ILPs, I'm sceptical that I should keep this policy. Would you advise me to give it up or continue with it?

REPLY

I suggest that you ask the insurance company about the charges for the next three years, i.e. what percentage of your premium will be invested. If the charges are small, it is probably better for you to continue the policy, as you have already incurred most of the front end charges.

It is quite sad that an insurance company can take away so much of a person's savings. You should tell your family and friends to avoid this type of policy in the future.

I intend to get a new life insurance company to introduce an ILP that has no front end charge. 100% of the premium will be invested. Tentativelyly, this is called the Wealth Accumulator.

Read this FAQ:
http://www.tankinlian.com/faq/low.html

6 comments:

Anonymous said...: Something like ID7 from NTUC? This would be fantastic.; April 05, 2008 7:59 PM
Anonymous said...: GREAT!
I'll be on the lookout for job advertisments for your new company! :)
I've just gotten my MAS license to advise and intend to pursue this career in line with your philosophy of best value to the customers.; April 05, 2008 10:29 PM
Unknown said...: Hi Mr Tan,

I think that Great Eastern have such kind of policy called GreatLink Ideal Investor. Is that what you are referring to?

http://www.lifeisgreat.com.sg/en/jsp/pdf/brochure_pdf/GL_idealinvestor.pdf

http://www.lifeisgreat.com.sg/en/jsp/products/products/investment/greatlinkidealinvestor.jsp; April 05, 2008 11:16 PM
Anonymous said...: To 10.29pm, hope you don't become a salesman or woman becuase you end up disappointed. Then you will be caught up like many who have gone astray. Instead of becoming an ethical , competent, honest practitioner you become a malpractitioner. So set your sight clearly and correctly , get the best qualification, namely a CFP, and position yourself as a financial planner and not as insurance salesperson.As a insurance salesperson you will be the most cursed as you can read daily in this blog. How hateful and despised are these insurance salespeople. All becuase of damage they have done to many people's life.
Start your career on the right footing and you will surely be a successful adviser.Before rushing in to join a company visit the website of FINANCIAL PLANNING ASSOCIATION OF SINGAPORE(FPAS) to see your career options.
All the best to you.; April 06, 2008 12:37 AM
Anonymous said...: It's very sad to read anyone with the same experience as me. I look forward to the your new ILP model. Is this under your own entity or other organization?; April 06, 2008 1:15 AM
Alex Logan Lee said...: I do believe Great Eastern have something similar to what you have mentioned.; April 09, 2008 9:09 PM