Saturday, April 17, 2010

Existing life insurance policies

Many people asked me about their existing life insurance policies - should they keep it or terminate the policy? In many cases, the policies were bought for them by their parents and are now transferred to them to pay the premiums. My usual advice is, "Keep your existing policy. You have already incurred the high upfront cost. Going forward, it should provide you with a modest return. "

However, if they have difficulty in paying the premium or they have better options to invest their savings, they can consider terminating the existing policies. Before they do so, they should calculate the return on the existing policy for the next five years. Read this FAQ.

They should think carefully before they put in more savings in a new life insurance policy. They should NEVER terminate any existing policy to buy a new policy - as it means incurring the high upfront cost all over again. They should avoid the insurance agent who makes this recommendation as the agent usually wants to make commisison at the expense of the client.

Some of these tips are given in my book, Practical Guide on Financial Planning.

Tan Kin Lian

Tips for young people

I wrote the book, Practical Guide on Financial Planning to educate young people who has just started work, about the importance of savings and the need to invest the savings in a liquid form so that they can be withdrawn without any penalty for urgent cash needs. You can save lot of money by avoiding high interest payments on borrowings or installment payments.

You should NOT lock up their savings in a life assurance policy that has a high distribution cost, poor liquidity and a heavy penalty on withdrawal. Be careful of insruance agents who will approach you soon after you started work. They are well trained to tell one-sided stories about the benefits of life insurance, but not the serious drawbacks.

Do not worry about protecting yourself against the risk of death. You only need to worry about it when you get married. If you can buy a group term insurance (i.e. SAF or SAFRA) or personal accident insurance, go ahead. If not, it does not really matter that you are not insured when you are still young.

Remember: when you sign on the dotted line to buy a high cost insurance policy, you will be giving away one or two years of your hard earned savings.

You should spend $12 and 12 hours to buy and read my book which is available online.  By being educated, you can save several thousand dollars by avoiding bad investment products. Do your friend a favour. Order additional copies to sell to them or present as a gift to them. It may be the most valuable gift that you can give them.

Tan Kin Lian

Bid for COE

I found that a car buyer can bid for the COE and, after being successful, is given 6 months to find a car. The deposit to bid for a COE for a car is $10,000 and the balance of the COE price is payable on the purchase of a car.

If you have $10,000 in cash, you can bid for a COE on your own and benefit from any drop in price. You may be negotiate a better price for a car, if you have a COE and can go to shop around.  If you do not have $10,000 in cash, perhaps you should not consider buying a car?

Escalating COE prices

The COE prices has increased sharply due to a reduction in COE available for bidding, and has been exaggerated by greed and fear.

We have to accept that COE prices will be high, due to limited supply and high demand, but we should try to avoid the large fluctuation in prices caused by the current bidding system. The system should be changed to reduce the volatility.

Some people have suggested the "pay as you bid" approach. I think that it has merits. The other change is to make it easier for consumers to bid for COEs directly, instead of relying on the motor dealers to do the bidding. Their profit on the COE increases the cost of ownership.

A better long term strategy is to reduce the demand for private car ownership by improving public transport and the use of taxis.

We have to improve the feeder service to bring commuters from their homes to the MRT stations or bus interchanges. The feeder services should have a waiting time of less than 5 minutes and be affordable (say 40 cetns).

We should also reduce the cost of taxi fares and increase the supply, so that more people can use taxis instead of cars. Each additional taxi on the road can reduce the demand for cars by 5 to 10 times. The cost of taxi fares can come down by reducing the taxis and levies on taxis and by removing unnecessary regulations that add to the cost of operations. If more people uses taxis instead of private cars, there will be less demand for parking spaces.

Tan Kin Lian

Friday, April 16, 2010

Tips on how to solve Tangram

Watch this video.

Dental health

I brush my teeth daily in the conventional way, using an ordinary tooth-brush. For the past few years, I have been visiting my dentist regularly to look at some dental problem. The dentist recommended that I should also use an inter dental brush (like a small christmas tree). This is an alternative to flossing the teeth, which has been quite troublesome.

Recently, I changed my brushing habit. Apart from using the ordinary brush, I spent a minute to use the interdental brush to remove the food particles between the teeth. It was quite easy and is likely to be quite useful.

Like to share your experience on dental health?

Here is a picture of an interdental (christmas tree) brush.

Property market in USA and China

Hi Mr Tan,
Here is an interesting article about the housing crash continuing in US even after all the stimulus.. I suspect that China(Shangai and HK) and eventually Singapore will suffer the same fate.

Here is another interesting article on possible crash of china propery bubble for you to read.

Thursday, April 15, 2010

Why Life Insurance Is Not an Investment

Life insurance is one of those things that most of us need but none of us enjoy talking about.

When it does come up in conversations, it’s mostly because someone is complaining about being sold a whole life insurance or variable life insurance that is both expensive and complex, who would be better off with a plain term insurance policy.

My comment
The same message is given in my b ook, Practical Guide on Financial Planning ($12) which is available here. Spend $12 and save a few thousand dollars by avoiding a bad investment.

Develop thinking skills with puzzles

Singaporeans need to develop the ability to think independent and to solve problems, rather than rely on their bosses for detailed instructions at every step of the way. This confidence and skill can come from a liberal arts education and can also be developed through practical training.

I have created four puzzles (i.e. tangram, shape quiz, einstein quiz and sudoku) that are useful in developing the thinking skills. These puzzles can be downloaded here.  Watch these videos to learn about how these puzzles help to develop the thining skills.

You can buy the puzzle books here. Spend some time to learn the thinking skills and develop the confidence through practice. It is also fun and interesting.

Tan Kin Lian

Singapore Talking - COE, 10.30 pm Sunday 18 April

I have been invited to be in the panel on Singapore Talking this Sunday at 10.30 pm on Mediacorp TV. The topic is on the high price of COE. I will be giving my views about moderating the fluctuation in price of COE and more importantly, about making public transport and taxis more comfortable and affordable.

Confrontational politics

Read this letter by Chee Soon Juan, published in the Straits Times

Interactive Health Tutorials

Visit this website.

Good signages to show directions

It is important to provide good signages to help people to find their way.  In recent years, there is too much focus on getting revenue for advertisements that result in signages being hidden or difficult to find. Here are some examples:

1. Whole buses are now being painted as a moving advertisement. It is difficult for the commuter to know if it is a public bus.
2. There are many advertisements in MRT stations and bus interchanges that the essential signages, such as EXIT and PLATFORM number, are difficult to find.
3. Even gantry gates of car parks are being converted into advertisements for property agencies.

When I visit an unfamiliar place, I have a lot of difficulty to find the way due to poor signages, but I get distracted by many advertisements.

There has to be a balance between the desire for advertising revenue and the need to give property signages and instructions to commuters. I hope that the regulatory authority comes into the picture. If the transport operators are restricted in their advertisements, it will create opportunity for other media, such as the newspapers and the television. This may be better for all.

Tan Kin Lian

Consumers can force reforms

Read this post in FISCA about the work being done by the Consumer Union of USA to force reform of bad practices. Join FISCA to strengthen consumer protection and education!

Send an email to TKL

New MRT interchange stations

The best interchange stations were at City Hall and Raffles Place. It was possible to change from one line to another on the same level. This was possible as the two lines were developed at the same time.

The worst interchange stations were at Outram Park and Dhoby Ghaut. The commuter has to walk a long distance to change from one line to another. Similarly, the walking distance between the two lines at Bishan is quite far. When a new line is built at a later time, after an existing line is operational, it is necessary to build the station at a distance from the existing station, due to safety and engineering reasons.

But there is another approach that allows the interchange stations to be build close together to reduce the walking time. In developing the new station, it is possible to build a new platform for the existing line, and to divert the existing line to use the new platform at a later date. I hope that the engineers consider this possiblity, so that the walking distance is reduced.

Tan Kin Lian

Polite drivers

Recently, I found a few instances of polite drivers on the roads in Singapore. On two occasions, I had to change lane at the last minute, due to unfamiliarity with the road. The cars behind slowed down to let me pass. They did not sound the horn.

On another occasion, I was waiting to make a left turn. I was temporarily distracted and waited much longer than needed. The car behind waited for one minute before sounding the horn softly to remind me. It was quite nice of the driver.

Tan Kin Lian

Autograph session for Financial Planning Book

I will be at MPH at Citilink Mall (1 Raffles Link, Basement B1-26A) at to 8.30 pm on Friday 16 April for an autograph session of my book, Practical Guide on Financial Planning. If you are interested to buy an autographed copy of my book, please turn up for this session - no need to pre-register. Pass the word around to your friends.

Land banking story on Channel NewsAsia

Channel NewsAsia interviewed me for a story on land banking. It will be telecast on Sunday 18 April, 9.30 pm. A staff of a land banking company has also said that the boss of that company has also be interviewed.

Adjudication in FIDREC

Some people have complained that they were unfairly treated at the FIDREC adjudication hearing. Perhaps they form a minority and that other cases had been handled satisfactorily and fairly. I invite you to share your story in this survey. I may use some of these stories to provide feedback to the appropirate persons, but will not reveal your identity.

Transport woes in Singapore

Read this article.

My comment
The solution is to improve public transport in Singapore and to make better use of taxis. More taxis should be put on the road and the cost of taxi fares should be reduced, e.g. by removing some of the tax on taxis and treating them as public transport.

Selling life insurance

There were some questions asked about how a life insurance agent can make a living, if the agent only sell term insurance to earn a low rate of commission.

Here is my answer. Similar to a general insurance agent or a stockbroker or a doctor. Earn a remuneration that is based on the value of the service that is given to the client, and not a high rate of commission that exploits the ignorance of the client.

A general insurance agent earns a commission of 15% on the premium that is paid to cover the risk. In Europe, the commission for motor insurance has decreased to 5% of premium, as the premium is high and the work involved is routine. The insurance agent can still make a living.

A stockbroker charges a commission of 0.3% of the invested sum, share between the firm and the remisier. They do not have to take away  150% of the annual amount of savings.

The doctor earns a fee based on the time spent on consultation and a markup on the medication. Due to competition, the fee is reduced to a rate that the ordinary people can afford. The doctor has to pay the rental of the clinic and the staff to man the reception.

Life insurance sales can also be made using the above approaches. Many people need a large amount of term insurance, say $500,000. They also need disability insurance and medical expense insurance. They can afford to spend up to 2% of their earnings (say $500 to $800 a year) to cover these personal risks. A 15% commision on this premium can be quite attractive.

The life insurance companies have to change its mode of marketing. Most importantly, they have to remember their responsibility to provide good value products and take care of the financial well-being of their clients.

Tan Kin Lian

Experience of an insurance agent

Dear Mr. Tan,
As im currently a new agent with one of the big insurance companies in Singapore, im finding its a lot different from what I was told or expected.
For example at the start we were told to emphasize needs based selling in order to meet the needs of our clients (basically what the MAS regulations said). Later I found out that nobody does needs based selling and all we do is get clients to sign on empty forms so we can go back to the office to fill them up later. End result : Client is clueless about what their needs are and how we are meeting them, if at all. Instead of talking to them about what THEY want, we spend our time giving presentations about interest rates and talking about how our relative racked up a huge hospital bill without insurance to pay for it.

The commission structure is also highly flawed and contributes to the high turnover rate of agents in the industry. There is absolutely zero incentive or point for agents to recommend products with lower commission rates. In fact, meeting a client to sell a term plan actually loses an agent money(unless it is a very big term plan) because the commission rate is simply not high enough to pay for the time + bus/MRT fare involved.

In my case, neither I or my colleagues were ever given product training on anything but the products with the highest commission rates. Also, this is actually a job that requires you to spend money in order to make money. The problem is that for most new agents, they will not be able to set sufficient appointments or close enough cases to make money for the first 1-2 months at least, unless they have a lot of contacts who are interested. The end result is they spend hundreds of dollars in food and transport expenses, and in the end all they keep hearing is "I'm not interested", and quit because they are heavily in the red and still can't find people who wants to buy insurance. It would be better if new agents were given a basic allowance of $400-500 for living expenses till they are seasoned enough to close cases on a regular basis.

With the high turnover rate of agents in the industry there is a high incentive to simply not train agents properly since a manager is spending too much time training someone who, according to statistics, will quit in a month or two anyway. Simply give them basic training, send them on whatever appointments they can make, and see if it works out. If not, oh well, go recruit more people. I was given a few days of training total, only a few hours of which was product related, and was told to go to my first appointment with the aim to do a presentation and simply convince him to buy and not ask questions. I ended up making stuff up when the client started asking about things I was not taught about. I felt pathetic.

As it is I am currently in the unenviable situation where I spend money travelling back and fro my office, making phone calls, doing surveys, doing coldcalls, mainly to hear phones ringing that people never seem to pick up (I never had any idea how under-utilzied handphones were in Singapore before) and I am not even able to set a single appointment because people keep postponing or simply dissapear off the radar and never pick up their phones again. All of this is costing me money and worst of all I cannot see a way to improve my situation. I do not have any senior agents I can look to for guidance since they are all busy rushing to meet quotas and my manager just keeps telling me to go out, do more surveys, make more phone calls, find and meet people, etc, but it is simply not working.

I have no clue where, exactly, I am supposed to find people interested in buying insurance or doing investments since almost everyone i meet simply recoils in horror at the mere mention of "savings" "investments" "protection" or any other key word that you can possibly use.

A scary amount of middle aged adults still believe themselves immortal and that they cannot possibly get hospitalized or worse, affecting their ability to provide for their family. Most young working adults simply go from paycheck to paycheck, saving $0 every month and heading straight for disaster the moment a situation calls for usage of emergency funds which do not exist, or they just dump a token amount into their bank account every month that dissapears into the newest xbox or ipod the moment they get enough. Most young working adults do not even have a clue what medishield or medisave is, other than that it is something CPF related.

I feel like im constantly rolling dice and seeing if I can get a lucky combination just to find a single interested person. I would like to continue on in this line of advising people on financial planning, but I do not see how as most people simply want to go through life without any financial planning or insurance protection at all. And actually I don't even know whether what im doing can be considered financial planning anyway.

Wednesday, April 14, 2010

How to spot a ponzi scheme

An early example of a ponzi scheme in Singapore was the Gemini Chit Fund that was promoted 40 years ago. Here is a brief story about this it. A more recent example is the Sunshine Empire.

In a ponzi scheme, the promoter promised you an attractive return. The early investors received that return. They were excited and put in more money. They encouraged their friends to join in the investment. The promoter was able to use the money received later to pay off the attractive return to the earlier investors. As long as more money came in, compared to the payouts, the promoter was able to continue to operate the sheme. During this time, the promoter was also able to siphon off the surplus into their pockets. When the ponzi scheme collapsed, all the remaining investors lost all of their money.

In terms of size, nothing beats the ponzi scheme operated by Bernie Madoff in USA, as described in this story.

There are many ponzi schemes now being operated in Singapore today. The mode of operation is the same. The story could be the fantastic growth of land plots, wine, industrical chemicals or other products. Heard them?

Retirement savings

Read this article,

My view.
It seems that the average amount that most people need for retirement in the USA is $1 million. I suppose that this include the value of the house. A similar amount will be needed in Singapore, i.e. $500,000 as value of house and $500,000 cash for retirement. At 4% yield (hopefully), $500,000 will produce $20,000 a year or $1,600 a month. This is similar to what most people comments in an earlier article in my blog.

However, if I am mistaken and most people expect $1 million cash on top of a fully paid house, then they are looking at monthly expenses of $3,200.

Tuesday, April 13, 2010

Confidence in leaders

Dear Mr. Tan,
I fully agree with an article on your blog (The future of our country). I have very little confidence in the next generation of leaders. All of them have never contested in a fair and open election, thanks to the grossly unleveled playing field (eg. GRC, ruling party's use of the entire govt machinery against the opposition party cadres, heavily biased and tightly controlled mainstream media).

How can they claim to represent the people if they are not elected by the people? This explains why they don't have any clue what the people feel/think. They just enact policies according to their liking. They think they know best. They don't have the decency to apologise when they are wrong.

This sad state of affairs worries me. I now seriously wonder if I should get PR status in say Australia. Having a team of "strawberry" leaders, who make policies out of an ivory yower, steering this country scares me like hell.

Financial Planning for a young person

Hi Mr Tan,
I am an avid follower of your blog. I like your advice, usually neutral and conservative which suit me.

I would like to ask for some advice from you about purchasing of my first life and health insurance. I recently decided to buy insurance from a friend. He didn't approach me rather it was me who approach him.

I am a 24 year old male. I am healthy I guess without much problem. I want to buy insurance from protecting my family from financial catastrophe.
I have do some reading about insurance but I think its still not enough for me to evaluate any insurance plan well.  After going through my financial, my friend/agent came back to me with 3 plans, one is term insurance, one is saving type insurance, the last is investment linked. (Details of three plans provided)

My question is, am I paying too much premium? Am I covering too much? The CPF portion seems to be taking quite a lot of money away?

I suggest that you buy my book, Practical Guide on Financial Planning, to read about the fundamentals of financial planning. It also explains why you should not buy any whole life or investment linked policy - as the distribution cost is too high.

You can buy the book here:

You should buy term insurance. The best type is from Aviva (SAF) or NTUC (SAFRA insurance). You can get a comparision of the cost here.

Asian economies urged to raise interest rate

Asia’s developing nations are recovering strongly from the global financial crisis, but should now start raising interest rates and adopt more flexible exchange rate policies, the Asian Development Bank said in a major report Tuesday.

My comment:
When interest rate is raised, you can expect property and stock markets to correct from their current level, which is a bubble caused by low interest rate.

Survey - expenses of a retired couple

How much does a retired couple have to spend each month to live in Singapore? Give your views in this survey.

I estimate that the expenses for a retired couple with a home for an adequate lifestyle is $1,200 a month and the bare minimum is $800. What do you think?

Defamation and fear

Singaporeans are so afraid to express any opinion, as they fear that any negative opinion about any person or organisation can be considered as defamtory. What a shameful state of affairs. How has the country got into this state?

Tan Kin Lian

The future for our country

A met a nurse at a wake. I said that the current government had done a lot of good for the people and the country during the first 30 years after independence. During the next 15 years, the policies have been bad for the people, as they led to high cost of living, stagnant wages and wide disparity of income. The government leaders are not working for the welfare of the people and appear to be looking after the intrest of big business and their own interest.

Most people have been quite unfair in judging the "poor quality" of the opposition politicians, as their main source of information is the mainstream media.

I know many of these politicians personally and appreciate their personal sacrifices in being willing to take a stand against the ruling party. Many of them are quite well educated and decent people, quite moderate in their thinking and feel strongly for Singapore.  Some people think that they only appear at election time. This is not true. They do spend time on the ground work, but are not reported in the  media. We must remember that they have to make a living and have to face difficulty in the business or at work.

She was surprised at my frankness. She started to express her own feelings of doubt about the future of our country and the direction that it is heading. She lamented that many Singaporeans are not able to think about what is good for the country and are afraid to think differently from what has been told to them in the media.

Tan Kin Lian

Monday, April 12, 2010

Gold investment scheme

Hi Mr. Tan,
Recently there is this gold investment scheme by 2 companies called X Gold and Gold label. They claim that it is a pretty low risk investment with 9% guranteed return after 6 mths which will mean a return of 18% annually. What is your opinion on this? Is it too good to be true?

Of course it is too good to be true. Never invest in promises that you do not understand.

Many investors were offered a return of 12.5% after 6 months on a land banking product and on an industrial chemical product. When the investment matured, they did not get back their principal or the interest. The promoter of the product gave all kinds of excuses - citing the financial crisis. It is easy for you to hand over your money, but difficult to get it back.

There is a chapter in my book, Practical Guide on Financial Planning, about unregulated products that should be avoided. You can buy the book ($12) here.

Who shot the lion?

80 year old man : My 28 year old wife is pregnant, your opinion Doctor?
Doctor : Let me tell you a story. A hunter in a hurry grabs an umbrella instead of the gun. He moves into the jungle, sees a lion, lifts the umbrella, pulls the handle and BANG... The lion drops dead!
Old man : That's impossible; someone else must have shot the lion.

Bursting of a property bubble

Read this article to learn what happens when a property bubble burst.

Anonymous comments in websites

Some websites may required commenters to give their identity. Read this article.

My view.
This is a good move as it makes the commenters more truthful and accountable.

HK: BOC staff charged over Lehman sales

Two employees of the Bank of China were charged by the Hong Kong police over the sale of financial products related to Lehman Brothers, the bank said, while a third staff member had been arrested and released on bail.
Bank of China said in a statement Sunday that the staffers had been charged under a securities law that prohibits fraudulent or reckless misrepresentation for the purpose of inducing financial transactions.

China property bubble

Read this article.

Liberal arts education

There are two letters in the Straits Times on the need for a liberal arts education in Singapore. One writer said that it helps people to think out of the box and to have the confidence to be different.

I agree with the observations. I found that, in general, most Singaporeans are not willing to think for themselves. They like to have instructions given to them in detail and will follow them specifically to the letter.
We need people who are more flexible, more independent in their thinking and more willing to take the responsibility to decide.

Tan Kin Lian

Links to letters in Straits Times Forum

Licenced moneylenders

There are a few letters in the Straits Times Forum about the high interest rate charged by licenced money lenders. The writers argued that the public needs to be protected against these unconscionable interest rate, that the free market does not work and desperate borrowers will accept the money on any terms. One writer is the president of Credit Counselling of Singapore, a non-profit body that helps borrowers to manage their debt.

This is another example of the failure of the market to give fair treatment of consumers. There are countless other examples. I hope that the Government realise this weakness and start to regulate the market more actively.

Tan Kin Lian

Links to the letters in the Straits Times Forum

Escalating property prices

The root cause is the low interest rate. It gave the impression that the high property prices are still affordable. At an interest rate of 2% on a property of $500,000 payable over 30 years, the monthly installment looks affordable at $1,966 a month. If interest rate increases to 5%, which is a more realistic level, the monthly installment increases by 31% to $2,581. Many people cannot afford this type of increase on a tight budget. But, it will come. Low interest rate cannot continue forever.

Look at it from another angle. The property prices should have been 30% lower, to be realistic based on the affordability of the population. During a period of low interest rate, the property developers increase the price and their marketing approach was to convince the buyer that it is affordable. It took a while for the buyers to buy into this thinking. The foreign buyers enter into the picture and started to move the property market.

This is followed by the speculators who see the chance to make a big profit. They buy the properties at the prevailing prices and expect to make a big profit by flipping over the properties on resale. Their demand pushes up the price. More people jump into the fray. This is called the "greed" factor.

The next batch of buyers are from the genuine end users who buy the prices at inflated value because they were afraid that they would increase further and be out of their financial reach. They jumped in and accept the high prices. This is called the "fear" factor. This is how the low interest rate could increase the property prices by 30%. 

The next level of increase comes from stretching the repayment period from the prudent level of 20 years to a more risky level of 30 years. It accounts for another 23% of increase. So, it is possible for the property prices to be 60% higher than the affordable level. The high property prices mean that most households are spending too much of their money on their homes, leaving less money for other types of spending and for their retirement.

Are high property prices sustainable? Just look at what happened to Japan 20 years ago. The crash of the property market put the economy in the doldrums for 20 years. Look at what is happening in America and UK today. They will suffer the same fate.  Do you think that Singapore will be any diffferent?

Tan Kin Lian

Sunday, April 11, 2010

Avoid all land banking products

Dear Mr Tan,
I really hope to get a reply from you as I respect your experience in many areas.

There is a Singapore company called X and they sells plots of land in UK. We are genuine investor and like to have your advice if you heard about them and whether there is any issue on reputation or scam which we should be aware of. There will be risk as we understand but it is a scam, we should be to think carefully.

You should avoid all land banking schemes It is not worth the risk. You cannot make a judgement of their reputation or rely on it.

There is a chapter in my book, Practical Guide on Financial Planning, that deal with unregulated products such as land banking and other get rick quick schemes. You can buy the book ($12) here.

Role of Parliament

The role of Parlimanent is to act as a check on the Government. Read this article.


Why do many Singaporeans want to emigrate to live in other countries? Read this article.

Bad advice on switching

Hi Mr. Tan,
I visited your blog and enjoy reading it. I need your advice on the following. Currently, I have (details of 4 policies provided)

Recently my new agent does an analysis and advise me that I required a life-policy. The agent suggested me to terminate the investment policy and get a life policy. The agent informed me that the premium paid till date is around $X and the surrender value is $Y (slightly more than $X). The agent cited that part of the investment profit are paid for the administration charge and others benefit like Death Cover, TPD and CCP.

I'm reluctant because I do not intend to terminate the investment policy but instead thinking of reducing the coverage amount so that the investment policy is indeed an investment policy not anything else. Please advise.

It is bad to terminate an existing policy and buy a new policy. Do not buy a life policy that has high upfront charge. If you need additional cover, just buy a term insurance policy, e.g. available from Aviva (e.g. SAF scheme). If you need less cover, you can reduce the sum insured on the investment policy.

Get the benefit illustration from the agent (for the new policy) and show to me. I will tell you if the agent has given proper advice to you.

You can read my book, Practical Guide on Financial Planning. There is a chapter on how to deal with existing insurance policy, and a warning to avoid switching to a new policy.

The book is available here for $12,

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