As more insurance companies move towards distributing more bonus as non-guranteed terminal bonus, it is important to use a method that ensures that the bonuses and cash values are fair to policyholders. This cannot be left to the discretion of the appointed actuary and the board, as the payout to the policyholder may be less than fair amount.
Many companies are now using "asset shares" to determine this payouts. I found that life insurance companies in Malaysia have adopted this concept. It is stated in this webpage:
http://www.liam.org.my/cms/layout/Printer.asp?ProductID=237&catid=13
It seems that Malaysia is ahead of Singapore in adopting this good practice, to ensure that policyholders get fair values on surrender, claim and maturity. It seems that the "asset share" method is well adopted in England, Australia and South Africa.
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