Dear Mr Tan,
I was reviewing the NTUC Luv plan which was launched recently. This looks affordable and comprehensive considering it covers life, TPD and critical illness - which will all expire at 70.
But looking at their monthly premium at age 60 and beyond, it make me wonder if this policy is still attractive since many in that age bracket may not be able to afford $300 a month or morre premium. Pls advice.
REPLY:
I am not familiar with this new product, which was introduced after I have left NTUC Income.
I suggest that you should talk to an insurance adviser (whom you can trust to give impartial advice) or call their business center?
Saturday, August 18, 2007
Cost of a critical illness rider
Hi Mr Tan,
Two years ago, I bought a critical illness rider for $60 per month for $50K which is attached to my whole life policy.
Is it correct to buy a rider, as it will expire should I decide to terminate my whole life policy? As I am now in my sixties, I may not want to spend too much on insurance. Pls advise.
REPLY:
I suggest that you should consider the following options:
1) The cost to you of continuing the whole life and critical illness rider for the next 10 years
2) The cost of an alternative method of giving you the protection
You should ask the insurance adviser to give information to you that you can understand, and make the best decision. Apart from talking to your current insurance adviser, you can also talk to another insurance adviser.
I hope that they can give you information to make a better choice.
Two years ago, I bought a critical illness rider for $60 per month for $50K which is attached to my whole life policy.
Is it correct to buy a rider, as it will expire should I decide to terminate my whole life policy? As I am now in my sixties, I may not want to spend too much on insurance. Pls advise.
REPLY:
I suggest that you should consider the following options:
1) The cost to you of continuing the whole life and critical illness rider for the next 10 years
2) The cost of an alternative method of giving you the protection
You should ask the insurance adviser to give information to you that you can understand, and make the best decision. Apart from talking to your current insurance adviser, you can also talk to another insurance adviser.
I hope that they can give you information to make a better choice.
Capital protection for Life annuity
Dear Mr Tan,
Does a life annuity allow the buyer to avoid losing the capital, if he dies at an early age?
REPLY
You can buy a capital protection for the life annuity. In the event of death during the early years, there is a refund of the balance of the capital (after deducting the annuity payments that have been received.
If you buy a capital protected annuity, you will receive a lower monthly payment. For a male at age 60, the difference is about 12 percent, i.e.
Monthy annuity for $100,000 of capital invested:
- with capital protection: $429
- no capital protection: $488
If the total paid out under the annuity exceeds the invested capital, there is no refund. This will occur after 19 years, in the above example. However, if the payment is increased due to bonus, the duration will be shortened.
You can read this FAQ for more details.
Does a life annuity allow the buyer to avoid losing the capital, if he dies at an early age?
REPLY
You can buy a capital protection for the life annuity. In the event of death during the early years, there is a refund of the balance of the capital (after deducting the annuity payments that have been received.
If you buy a capital protected annuity, you will receive a lower monthly payment. For a male at age 60, the difference is about 12 percent, i.e.
Monthy annuity for $100,000 of capital invested:
- with capital protection: $429
- no capital protection: $488
If the total paid out under the annuity exceeds the invested capital, there is no refund. This will occur after 19 years, in the above example. However, if the payment is increased due to bonus, the duration will be shortened.
You can read this FAQ for more details.
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